Government has cut its budget for consumptive expenditure including travelling abroad by 50%, the Finance Minister Matia Kasaija revealed on Wednesday.
He said that this was done to find money for setting up infrastructure such as roads that will facilitate the oil industry in the Albertine region.
The budget has been reduced by an estimated Ugsh 300 billion which Kasaija said will go into construction of 4 roads but also to address the famine crisis that has hit several districts in Uganda due to prolonged drought.
“I have to find money to make an extra 4 roads leading to the oil wells in the Albertine region if we are to meet our target of getting our first oil in 2020. These roads require USD 534 million,” Kasaija told journalists on the sidelines of the Diaspora business forum at Hotel Africana.
He added; “It is true. We have Ugsh 300 billion from the consumptive allowances across sectors except a few. But this amount is still a drop in the ocean so we shall still have to find money elsewhere.”
He said items that will be affected by the cut include travelling abroad, seminars, tea in offices and newspapers for offices.
Commenting on the development, the National Planning Authority Executive Director, Dr. Joseph Muvawala told ChimpReports it was ‘a major step’ by government.
“The resources that have been cut have been allocated to productive areas such as exports and ensuring that productivity goes up,” Dr. Muvawala told ChimpReports.
He said a detailed analysis is required on what other areas government should cut unnecessary spending.
“Some people think districts are becoming too many, that Parliament and Cabinet are too big. As a country, we need to discuss what we need.”
“Of course these cuts will have an impact on certain sectors sectors but the economic benefit will be much bigger.”
In an earlier presentation, Dr. Muvawala argued that for Uganda to realize it’s ambitious dream of achieving lower middle income status by 2020, government must revise its borrowing patterns.
Currently, Uganda’s deficit stands at 6% of the national budget two times higher than the recommended deficit cap if the country is to achieve its 2020 target.