Kampala, Uganda | THE INDEPENDENT | The Ministry Finance, Planning and Economic Development says a total of 589 billion shillings was returned unspent to the Consolidated Fund by local governments at the end of financial year 2020/2021.
The Public Finance Management Act, 2015 provides that all unspent balances from Ministries, Departments, and Agencies be sent back to the Consolidated Fund by 30 June, before the start of every new financial year.
In spite of releasing the funds timely, the ministry says up to 119 billion meant for wage bill was returned unspent, gratuity 18.9 billion, pension 7.7 billion, non-wage recurrent 35.5 billion and 40.7 billion for development.
While addressing leaders from Acholi and Lango sub-regions during a budget consultative meeting held at Bomah Hotel on Monday, Henry Musasizi, the State Minister for Finance in-charge of General Duties said government is committed to increasing Local Government funding, but the funds are regrettably being returned unspent.
Musasizi attributed it to late procurement, poor monitoring and supervision of government projects and delayed recruitment by the Local Governments. He threatened that the ministry will not approve any supplementary budgets for the unspent balances without clear justification why the funds were not absorbed.
But William Komakech, the Omoro District Chief Finance Officer reasoned that funds are inevitably returned to the Consolidated Fund because of the hybrid contracts that are managed from the centre with less involvement of Local Governments.
Denis Nickson Opiyo, the Lira City planner observed that several newly created administrative units like the cities do not have staffing structure making it impossible to spend the allocated wage without guidelines.
Apac Resident District Commissioner Emmy Ngabirano made it clear that the ministry has its own under-performance issues, citing sending funds to the Local Governments without guidelines and therefore leaving such funds not utilized.