Deputy Speaker, Thomas Tayebwa, has instructed the Committee on National Economy to conduct an assessment of Uganda’s public debt, addressing concerns over its escalating burden. The directive was issued during the debate on the National Budget Framework Paper (NBFP) for financial years 2024/2025 – 2028/2029 on January 30, 2024.
As of June 2023, the Minister of State for Finance, Planning, and Economic Development, Hon. Henry Musasizi, reported a public debt stock of Shs86.7 trillion. Tayebwa granted the committee one month to complete the assessment, enabling informed parliamentary discussions.
Tayebwa emphasized the importance of a thorough debate, acknowledging varying perspectives on the sustainability of Uganda’s debt compared to other countries. The directive followed concerns raised by Butambala County Member of Parliament, Hon. Muwanga Kivumbi, who warned of potential blacklisting due to debt repayment challenges.
Kivumbi highlighted a substantial increase in debt refinancing and interest on domestic debt, urging Parliament to address the growing debt burden. The lack of a national health insurance scheme was identified as a contributing factor, pushing many households into poverty due to high healthcare costs.
Several lawmakers, including Hon. Mathias Mpuuga and Hon. Hassan Kirumira, criticized the Ministry of Finance for not presenting a public debt management framework, as required by the Public Finance Management Act. They called for transparency in disclosing details of lenders to make informed recommendations.
The issue of domestic arrears amounting to Shs2.7 trillion as of June 2023 was also discussed. The Leader of the Opposition, Hon. Joel Ssenyonyi, questioned the government’s prioritization of external debt repayment over clearing domestic arrears owed to local suppliers, urging a more balanced approach.
In the 2024/2025 financial year budget, Shs200 billion has been allocated to address part of the domestic arrears, a move considered insufficient by Ssenyonyi. Musasizi acknowledged the commitment to reducing domestic arrears but cited resource limitations.
The Chairperson of the Budget Committee, Hon. Patrick Isiagi, expressed frustration with the persistence of domestic arrears despite the implementation of a commitment control system.
The NBFP, a strategic document linking government policies to the annual budget, was presented by Minister Musasizi during the plenary sitting on January 25, 2024. The projected resource envelope for 2024/2025 is Shs52.7 trillion.
