This week, Parliament approved the Budget Framework Paper for the 2025-26 financial year, although nearly half of this budget will be used to manage the debt burden. According to information, the approved funds totaled 57.4 trillion shillings.
Kira Municipality MP, Hon. Ibrahim Ssemujju Nganda, pointed out that almost half of the upcoming year’s budget will be allocated to paying off Uganda’s debts, as the public debt has reached 109.8 trillion shillings.
“The overall budget is 57.440 trillion shillings, but nearly half of it, amounting to 20.726 trillion shillings or 35%, will be for debt servicing,” stated Ssemujju.
Hon. Ssemujju urged Parliament to reject the Budget Framework Paper, opposing the Government’s proposal to borrow an additional 24 billion shillings to fund next year’s budget, even as Uganda’s debt stands at 109.8 trillion shillings.
He reiterated this appeal in his minority report, criticizing the Government for dedicating only 200 billion shillings for the payment of domestic arrears, while the outstanding arrears total 14 trillion shillings.
“The money the government owes to its citizens, known as domestic arrears, has reached 14 trillion shillings, which is a 30% increase from the 10.8 trillion shillings reported in the 2023/24 year. Yet they have allocated a meager 200 billion shillings in the budget for these arrears. This includes 250 billion shillings for gratuity and pension. We have witnessed elderly individuals break down in tears on television due to their unpaid pensions and gratuities,” said the MP.
Ibrahim Ssemujju (Kira Municipality) also expressed worries about the inconsistencies in the budget allocations for debt servicing, highlighting that while the documents provided to Parliament state that debt servicing will be 20.726 trillion shillings, this figure differs from what is shown on the Ministry of Finance’s website, which lists the amount for debt servicing at 21.612 trillion shillings, leading to a discrepancy of 886,218,863,586 shillings.
“By endorsing the Budget Framework Paper, you are effectively permitting the government to borrow more. You can expect Hon. Henry Musasizi to continue bringing loan requests to Parliament throughout the next financial year. The total public debt figure is also disputed. When calculating public debt, the Ministry of Finance does not take domestic arrears into account.
They have pressured the Auditor General to omit them as well. Finance is asserting that the public debt is 94 trillion shillings, up from the 86 trillion shillings disclosed last financial year. One strategy Finance employs is to exclude undisbursed loans, even though we incur commitment fees on them,” Ssemujju further commented.
Additionally, Ssemujju, who serves as the Shadow Finance Minister, disclosed that in next year’s budget, the Government plans to allocate 298.525 billion shillings for purchasing special meals, while 132.251 billion shillings will be designated for acquiring bed linens and footwear for high-ranking officials, and 237.021 billion shillings will be allocated for conducting workshops and meetings.
Despite concerns that this BFP contradicts the National Development Plan 4, which runs until the 2029/2030 financial year, it was passed. Several lawmakers had argued that this inconsistency violates the Public Finance Management Act.
Furthermore, the legislators also raised concerns over limited allocations to various critical sectors such as health, education as well as infrastructure, questioning the government’s prioritization in the budget.
