Parliament tasked to scrutinise surging public debt in Uganda

This directive, issued amidst discussions on the National Budget Framework Paper (NBFP) for the fiscal years 2024/2025 to 2028/2029, marks a pivotal moment in the country's economic governance.

The urgency of the situation was underscored by the Minister of State for Finance, Planning and Economic Development, Henry Musasizi, who reported that as of June 2023, Uganda's public debt stock stood at a staggering Shs86.7 trillion.

Faced with these daunting figures, Tayebwa has given the Committee a one-month deadline to evaluate the public debt, thereby setting the stage for a comprehensive parliamentary debate.

This significant development was propelled further by a passionate plea from Butambala County MP, Muwanga Kivumbi, who warned of the dire consequences of the mounting debt.

Kivumbi painted a grim picture, revealing that Uganda risks being blacklisted for non-repayment of debts, with debt refinancing expected to surge by Shs9 trillion this financial year.

He highlighted a critical increase of Shs1 trillion in interest on domestic debt, emphasizing the urgent need to address what he termed as the 'animal called national debt'.

Mathias Mpuuga and Hassan Kirumira, echoing these concerns, criticized the Finance Minister for the lack of a clear public debt management framework and demanded transparency regarding the details of lenders. Their call to action was aimed at enabling lawmakers to make informed recommendations about borrowing practices.

The debate also brought to light the issue of domestic arrears, which, as of June 2023, amounted to Shs2.7 trillion. The Leader of the Opposition, Joel Ssenyonyi, questioned the government's prioritization of external debt repayments over settling domestic dues, pointing out the adverse effects on local businesses and the economy at large.

Despite the Ministry of Finance's allocation of Shs200 billion to address part of the domestic arrears in the 2024/2025 budget, Ssenyonyi argued that the amount is insufficient.

The Chairperson of the Budget Committee, Patrick Isiagi, expressed his disappointment over the persistent issue of domestic arrears, despite the implementation of a commitment control system designed to prevent such backlogs.

The NBFP, presented by Minister Musasizi and serving as a crucial strategic document linking government policies with the annual budget, forecasts a resource envelope of Shs52.7 trillion for the 2024/2025 financial year.

This latest parliamentary directive to scrutinize the public debt reflects a growing awareness and concern among Ugandan legislators regarding the nation's economic health and the need for a sustainable fiscal path.