The Ministry of Finance has started to release funds for the first quarter of the 2021/2022 financial year, largely focused on the health sector and more specifically on the fight against COVID-19.
In total UGX 5.67 billion has been released for the first quarter, representing 25 per cent of the approved government budget, excluding external financing and public debt.
“The quarter has given priority to the health sector and other supporting sectors because the country needs to get back to normalcy soon in order to sustain the economy,” says Patrick Ocailap the Acting Permanent Secretary of the Ministry of Finance.
On June 28, 2021, the Executive Board of the International Monetary Fund (IMF) approved a 36-month arrangement under the Extended Credit Facility (ECF) for Uganda in an amount equivalent to SDR722 million (200 percent of quota or about US$1 billion) to support the post-COVID-19 recovery and the authorities’ plan
to increase households’ incomes and inclusive growth by fostering private sector development.
Approval of the ECF arrangement enables immediate disbursement of about US$258 million, usable for budget support. This follows Fund emergency support to Uganda under the Rapid Credit Facility (RCF) in May 2020 of SDR361 million.
Uganda’s economy was hit hard by the COVID-19 crisis. Decade-long gains in poverty reduction were reversed, fiscal balances have deteriorated, and pressures on external buffers have intensified.
A mild recovery is underway in some sectors, with economic growth in FY 21/22 expected to reach 4.3 percent before returning to pre-pandemic rates of 6-7 percent in the medium term. The outlook remains highly uncertain, with risks tilted to the downside,
including from a resurgence of tighter containment measures linked to higher COVID-19 positivity rates.
The authorities’ program, enshrined in the third National Development Plan (NDPIII), is built around the principles of private sector-led inclusive growth and public sector reforms to
strengthen governance and transparency.
It envisages multi-year fiscal consolidation while increasing priority and high-quality infrastructure spending. The program will include reforms to increase domestic revenue, foster public sector efficiency and strengthen governance while preparing the ground for sound management of oil revenues.
The program will strengthen the monetary policy and financial sectors frameworks while fostering development, including through financial inclusion.
The ministry of Finance has provided a supplementary expenditure of UGX 206 billion was provided for the health sector largely to cater for the requirements for controlling the pandemic.
At least UGX 94.9 billion will be spent on the provision of oxygen, while UGX 67.5 billion will go towards logistical expenses, staff expenses and case management, among others.
Hospital infrastructure including Intensive Care and High Dependency Units and hospital beds have been given 11.5 billion Shillings and another UGX 27.8 billion goes to the revitalization of the Village Health Teams, which Ocailap says, will be vital in containing the second wave of the pandemic. UGX 218 billion has been released for the purchase of vaccines.
While announcing the release of the funds Ocailap said they have responded to the demands by the nurses and midwives demand and the presidential directive, by releasing Ushs32.3 billion for the first quarter that starts July 1.
The release for quarter one caters for requirement to increase Nurses and Midwives lunch allowances. In May this year, the health workers went on strike over lunch allowances estimated at 70 billion Shillings, which they said was meant to cater for 26,000 nurses and midwives at a rate of Ushs15,000 per health worker, per day.
They have been entitled to between Ushs2,000 and 3,000 daily for lunch which they said was not even enough for a cup of tea.
The President of the Union, Justus Cherop Kiplangat, says that President Yoweri Museveni in 2018 promised to see the allowances increased to Ushs15,000 per day, but this had never been effected. According to Ocailap, the workers will now be paid between Ushs10,000 and 15,000 per day, depending on the salary scale.
Now, Cherop says there should be no excuses for absenteeism from work by the nurses, since the government had agreed to meet their demands, adding that they expect that even other areas of their remuneration will be improved with time.
Last year, the then State Minister for Health Robinah Nabbanja said the plans had been affected by the outbreak of Covid-19 which required reallocation of resources to deal with the pandemic. The strike ended a week later after government said it had earmarked 44.9 billion Shillings towards providing a daily lunch allowance of Ushs10,000 for 22 days.
Workers’ Representative in Parliament Dr. Byakatonda Abdulhu urged the Ministry of Public Service and that of Finance to update the payroll so that payment is effected.
He has called on the government to ensure that even demand by other sections of the health sector are met soon, so that the human resource part of the problem is solved.