WITH THE ECONOMY WE HAVE TO BITE THE BULLET

The challenge of Uganda is that we don’t have enough money! Surprise! Surprise!

The annual budget is sh32trillion, which means government has committed to spend about sh800,000 per Uganda for this year. On education, health, security, building roads and all other things government spends on. As Ugandans we are contributing about sh400,000 of this sum in taxes with the sh400,000 deficit coming from borrowings – locally and abroad.

I repeat this statistic because when I first broke it down it shocked me to the core. And it still does.

Put in this perspective is blindingly, obvious to me, that the government budget is too small. And secondly that with such a small kitty how is government expected to achieve anything.

I mean they have earmarked sh57,000 for each Ugandan’s health needs and  for our protection they have committed the princely sum of sh53,000 per Ugandan for the whole year.

Putting aside our official’s propensity to dip their fingers in the till, how can anything get done to any satisfactory measure with these statistics?

"This numbers look starker when viewed against our population growth and development ambitions.
As it stands now our population is set to double every quarter century. So it’s 40 million now and will be 80 million in 2043 and 160 million in 2068, assuming the current growth rate continues, which it will unless we get a grip on poverty. A story for another day...

All these multitudes deserve good health, education and other social services as well as good infrastructure and a coherent government.

The World Health Organisation recommends that countries should see health expenditures – both in the public and private sector, of about $84 (sh310,000) per person a year. According to the latest statistics available in 2015 Uganda health expenditure came in at $46(sh170,000), just over half the recommended average.

Using these figures private expenditure on health is about sh117,000 per person annually. Assuming the ratio of public to private health expenditure remains the same government would have to double its budget just to meet the bare minimum requirements.

This in health but similar increases or more are warranted from everything from the gender ministry to Uganda National Road Authority (UNRA) to energy budgets. Just to get us to where we can all live bearable lives.

The next question is, where do we find the money to ramp up our spending?

URA a year or two ago set themselves the task of ferreting all the tax dodgers in the informal sector. We were shocked to hear that among the tax dodgers URA  has its eye on accountants, lawyers, doctors and all those professionals who go into self-employment, they counted them as being in the informal sector.

The recent taxes on mobile money were an attempt to tax incomes that were proving hard to find.

This was probably one of the less radical tax initiatives – despite the howling, this government could have suggested.

There is a lot of money in land. Tax all the land I say. People with idle land will be forced to put it to use or lease or sell it to others who can. With that single stroke we will increase production which in turn will bring in more revenue.

Of course the issue of land is always politically sensitive. So the leader who bites that bullet will either be working themselves out of a job or be ready to pull out all the stops – forget tear gas, to enforce his will.

"The writing is on the wall. These are desperate times – or about to be, and therefore require desperate measures...

We will not be the first.

China’s chairman Mao in a race to industrialise determined that his country needed to produce more steel. In this effort people were required to have a backyard smelter in order to meet the steel production of individual collectives. To meet those quotas people ended up smelting everything cutlery, fixtures and furniture.

The result, this was the beginning of one of the world’s largest steel industries, but the unintended consequence was that in an effort to fire up those millions of backyard smelters, the impact on the environment was so devastating that the repercussions continue to date.

There are no shortcuts.

There will be short term pain and woe onto those living in the era of transition, but as they say there can be no gain without pain.

And it will be an other generation of politicians that will benefit from our sacrifice, because there be no romance without the finance.