The Permanent Secretary/Secretary to the Treasury Mr. Ramathan Ggoobi has revealed that the Government is strictly going to carry on with the spending optimization in areas of the economy that have the biggest impact.
While addressing the media on quarter one expenditure releases for Financial Year 2023/24 on Tuesday at the Ministry of Finance headquarters, Mr. Ggoobi said that in order to continue preserving the country’s debt sustainability while encouraging an impressive post-Covid recovery, Government will not spend money it doesn’t have.
“Instead of borrowing beyond optimal levels, we shall whenever necessarily reduce expenditure for activities that do not add to the value of the economy or wellbeing of Ugandans. In particular, we shall not borrow at interest cost that is too high, especially in the domestic market,” he said.
The PSST added that Government will continue to explore the same new financing initiatives that were used in the last financial year, enabling it to reduce financing costs.
Last financial year, due to these new financing initiatives the Ministry of Finance was able to save the taxpayers over Shs1.977 trillion in interest costs.
“We intend to continue pursuing innovative financing. Consequently, we call upon our financing partners in the domestic market to adjust their expectations. The government will only contract domestic debt if and when it makes financial sense to the taxpayer,” he said.
He also warned all government entities that no recruitment should be done without clearance from the Ministry of Public Service after ascertaining the availability of adequate Wages from this Ministry. And if it’s to be done, should be on a replacement basis or if the wage bill was already available to the Ministries, Departments and Agencies (MDAs), and Local Governments (LGs).
“Accounting Officers are required to ensure that every promotion and re-deployment of staff made to a different cost centre is backed up by adequate Wage provision; and All Government operations this financial year will underpin fiscal discipline, budget credibility, commitment. to service delivery and timely project execution,” he said.
He also warned that the Ministry of Finance and Economic Development will not entertain supplementary expenditures that are not for security or industrial policy purposes.
Meanwhile, according to Mr. Ggoobi, over Shs4.833 trillion representing 16 per cent of the discretionary budget has been released to MDAs and LGs.
Wage is projected to perform at Shs1.824 trillion or 25 per cent of the wage budget. This includes a 50 per cent release for Missions Abroad to hedge them against loss of poundage; Shs169.968 billion has been released to cater for payment of Pensions for retired civil servants and Shs147.778 billion provided to cater for Gratuity payments in the quarter
Under the Education sector, the capitation grants for schools have been fully provided to cater for Term Three of the school year. Shs140.241 billion (25 per cent of the approved annual budget) has been provided to National Medical Stores for the purchase of essential medicines and drugs, Shs50 billion has been provided to Uganda National Roads Authority (UNRA) and Ministry of Works and Transport (MoWT) to pay for certificates for the ongoing projects.
At least Shs91.013billion has been provided to universities in line with the semester requirements of which Makerere University Shs31.181 billion, Kyambogo University-Shs17.481 billion, Makerere University School of Business (MUBS) -Shs8.678 billion, Uganda Management Institute (UMI)-Shs3.877 billion, Mbarara University-Shs3.908 billion, Gulu University- Shs 4.146 billion etc.
Shs111.687 billion has been provided to cater for arrears under institutions of which Shs10.446 billion is for Salary arrears and Shs101.240 billion is for Pension and gratuity arrears.
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