Members of Parliament on the Budget Committee remain deeply concerned about the escalating national debt prompting them to scrutinize the Ministry of Finance, Planning, and Economic Development for effective management strategies.
The State Minister for Finance, Hon. Henry Musasizi disclosed that as of June 2023, the country’s total debt had surged to US$23.7 billion, a significant increase from the US$21 billion recorded in December 2022.
This revelation came to light during Musasizi’s presentation of the National Budget Framework Paper for the financial years 2024/2025 – 2028/2029 before the committee, chaired by Hon. Patrick Opolot Isiagi.
Musasizi said that despite the rise in Uganda’s overall public debt, government is managing resources through efficient allocation and limited borrowing in critical areas.
The minister added that of the current shs2.7 trillion of domestic arrears registered as of June 2023, government plans to set aside shs200 billion in financial year 2024/2025 to pay off part of the arrears.
Otuke County Member of Parliament, Hon. Paul Omara tasked the minister to clarify contrasting reporting on public debt where the Auditor General’s report put the country’s debt at shs96 trillion, yet the Ministry of Finance reported shs86 trillion.
“You know the Auditor General is the auditor of government and whatever figure they give us, we take it. These are trillions of shillings; these are not small amounts. We think these could be problems from instability in exchange rates,” Omara observed.
Hon. Dicksons Kateshumbwa (NRM, Sheema Municipality) alluded to the Charter of Fiscal Responsibility saying the domestic debt repayments to total revenue projected at 18.9 per cent against the 13.6 per cent target, is worrying for Ugandans.
“It is very worrying because debt repayments are eating away a huge portion of our revenues. So we are not complying with the charter and we need measures to stay within the projected range,” Kateshumbwa said.
Hon. Iddi Isabirye (NRM, Bunya County South) urged the minister to analyse the level of implementation of approved loans to assess their performance.
The Secretary to the Treasury, Ramathan Ggoobi said that with the growth of tourism receipts and exports through foreign-direct investors among others, the country’s fiscal deficit is reducing.
“The debt is sustainable. Uganda is fully participating in international credit markets where many countries in Africa struggle to gain access and cannot be allowed to borrow,” Ggoobi said.
He added that government has a good strategy to address the risks involved, saying the country’s macro-economic management is good.
Hon. Alex Ruhunda (NRM, Fort Portal Central Division) called for robust intervention by the Ministry of Finance into the tourism sector, which he said has recovered from the effects of the lockdowns posed by the Covid-19 pandemic.
