SAPS; UGANDA’S FAVOURITE BOGEY MAN

Picture this, you are in a world of hurt. Your income can not cover a month as the demands on that money –school fees, rent, fuel, food are just overwhelming. As if that is not enough, you lose your job. So, you go to your neighbour who is better off, for a loan.

Your neighbour would love to help, but more importantly he wants to get the money he lends you back, at some pre-determined point in the future. He is not a charity.

So, he sets some conditions for you if he is to lend you the money. Getting a job may not be easy, so most immediately he makes it a condition that you cut back on your lifestyle – move into a cheaper house, shift your kids to less expensive schools, cut out morning and evening tea and on some days you can eat two instead of one meal.

In the meantime, he wants you to look for a job. He may even be willing to pay your school fees to upgrade your qualifications. He wants to improve his chances of being paid back.

You have a choice to put pride aside, bite the bullet and accept the prescription in order to get the loan or tell your neighbour to go to hell and go and beg or con someone else who will lend you the with less onerous conditions.

Extrapolate this to the national level and these are the choices that faced the NRM and the Obote II before them.

"When the NRM came to power in 1986 not only were the national coffers bare, but also the economy had shrunk below its level fifteen years prior. In fact, it took almost 15 years from 1986 to grow the economy back to where it was in 1971...

After trying to get the economy back on its feet on our own resources failed, they turned to the World Bank and the International Monetary Fund (IMF) for help.

To access financing from these two Bretton Wood institutions they had to sign up to some conditions, which basically were to cut back on government spending and raise tax collections – Structural Adjustment Programs (SAPs).

This is not high finance, its commonsense.

Among the things government had to do was to shrink the size of government, sell loss making parastatals and liberalise the economy, let the private sector drive growth. In terms of raising taxes the Uganda Revenue Authority(URA) was created and invested more in infrastructure.

The measures to cut costs meant for starters, quite a few people lost their jobs a government was downsized and parastatals were sold off. Government struggled or cut budgets to things like university education and sports.

It is understandable why people were not happy with it.

"NRM tried to do it alone, thinking they could print money to climb out of the economic hole they found themselves, but this only made matters worse, with inflation hitting 250 percent a year...

To put that inflation rate in perspective it means prices were doubling every four months. That meant if you paid one million in school fees for your kids in January when you went back for second term it would be two million shillings and in third term would be four million shillings. we were here screaming when the price of petrol went up from sh4000 to sh5000 a 25 percent increment in a year, what would we be saying in 1987 when inflation was galloping out of control?

So when I hear people criticizing SAPs I think two things, either they were the beneficiaries of the economic chaos or they don’t know what they are talking about. I found that more times than not it is the latter rather than the former.

The main criticism of the SAPs was that it opened up our economies to the acquisition of our “assets” by foreign capital.

In Uganda’s case we are being very generous by classifying our parastatals as assets. An asset makes you money but these companies were a drain on the treasury, diverting money for more essential services to prop up under capitalised and badly run companies. People say if only government had recpaitalised the companies they would have been fine. When I hear this I don’t know whether to laugh or cry.

Government was so broke that it shut down Uganda airlines because it could not afford the sh10b (about $10m) a month it cost to keep it afloat. Today government would fill little pain with such payments.

If our “assets” were taken it was because of our own weakness. Kenya across the border from us did not have to let go of their state enterprises, because they were actually net positive contributors to the budget.

Now I hear President William Ruto is looking to flog them on the open market to raise money to clear some of the country’s huge debt. Common sense.