SOMETHING IS GOING TO GIVE

A week or so ago, it was reported that parliament had earmarked a budget of sh165b or sh300m for each of the 520 MPs to buy a car.

Understandably there was a public uproar. In this time when we are trying to recover from the Covid-19 related down turn in the economy, when many are seeing lower incomes or loss of jobs altogether, when businesses are shutting down up and down the street,

this shameless show of public gorging at the trough was worse than a slap in the face of Ugandans....

History shows that among the main  reasons for economic collapse, is when countries starve or eliminate the productive sectors of resources in favour of consumers.

We saw it in the 1970s with the expulsion of the Asians by Idi Amin.  The Asians at the time dominated the commercial space – as they did all over East Africa. You might not like the Asians, business skills are passed on through mentorship not through presidential edict. It is the reason why some of our most respected businessmen have learnt their skills at the feet of Asian businessmen, and why too, Kenya’s indigenous business community is more robust than our own.

It happened more recently in Zimbabwe, where Robert Mugabe in a last desperate attempt to hang on to power dispossessed white businessmen of their land. The result was that Zimbabwe went from a net exporter of food to a recipient of food aid today.

In the 21st century less brutal means are being used but work nevertheless. 

When MPs get sh165b for cars to whizz around the country, sectors like tourism – our largest foreign exchange earner, have been allocated sh176b in the 2021/22 budget. Gold has overtaken coffee as our largest export earner, but only sh81b has been allocated to mineral development.  

The winner has to be that government has allocated sh102b to digital transformation. 

Last year if there were any doubts that this country needs to fast track the adoption of ICT technologies, the Covid lockdown removed all doubt. Businessmen were forced to adopt electronic payment systems and online delivery to stay afloat. We need more government investment in infrastrucure and training as well as forward looking policies that will ensure we keep up with modern trends. Consumers need faster internet speeds and those who don’t have, should not be left behind.

Maybe the sh100b earmarked for digital transformation is enough but it speaks to what our priorities are.

Parliament, which has grown to an ungainly 520 members while our revenues are expected to fall short of the projected sh21.8trillion by sh3trillion. It is common sense – or at least it should be, that when your incomes is falling you have to cut your expenses, but clearly not in Uganda.

It would be funny if it weren’t frightening...

People forget that the reason we had to suffer the Structural Adjustment Programs (SAPs) of the 1980s and 1990s, at the heart of it, was that we were not collecting enough revenue to meet our costs. So we were forced to cut back on our costs as a condition to borrow the money to jump start the productive sectors of the economy.

If we are not careful we may find ourselves back in the same place and not because of war and destruction...

As it is now one in every three shillings of the budget – sh15trillion is going to go towards debt repayments. This would not be a problem as long as the economy is growing and tax revenues are following suit, but that is not the case.

And since we don’t want to tighten our belts we have to borrow more to cover the deficit, and who approves government loan requests? Parliament. What a racket!

To be fair there are other questionable expenditures up and down the budget – did you hear about the sh481b the Bank of Uganda did not want?

So God forbid one day we will wake up a we can not service our debt and the foreign lenders will  return us to SAPs. Hopefully one of the fist things they will insist on, is to take an axe to parliament’s ballooning budget. And of course parliament will mobilise us lemmings to protest against the “imperialist” agents, yet they are the ones through their own profligacy, that will have sunk us into the hole. Unfortunately health, education and infrastructure budgets will be cut slowing down our development ambitions.

Some may argue that the sh165b is to cater for cars over the next five years, but it is still a one off hit on next year’s budget.

Ok given that the MPs need transportation to carry out their “important” duties in their constituencies, but there are much more cost efficient ways to do this.

For instance government can lend the MPs the money to buy their cars. Even if they gave them interest free loans that would be much cheaper than what is currently happening. One advantage of this is the MPs would be forced to cut their coat to fit the cloth and we might have a more  rational distribution of cars, not all fuel guzzlers as it is likely to be now.

But even cheaper for government is if it got a fleet management company that would own  and maintain the cars. Also in addition they would rationalise the fleet, there is no reason why the Kampala Central MP should have a car of the same capacity as the MP from Arua, Kabong or Kisoro.  This will have real cost saving implications not only in the cost of the cars but also the cost of running them. 

And those are a but a few options we should, no, must adopt, in order to come out of the current economic crisis standing.

Unfortunately this is not going to happen.

Our public servants and officials see the treasury only as means for accumulation and self aggrandisement and to hell with the rest of us....

Imagine where this country would be if those same MPs set their minds to building enterprises that can sustain them in the lifestyles – sh20m a month salary, they have now become accustomed?