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Uganda: Finance slashes KCCA budget by Shs95 billion

Kampala- Even when Kampala Capital City Authority (KCCA) has been grappling with low funding, government has slashed their budget for 2019/20 by Shs95b.

According to the budget circular from Ministry of Finance, government allocated Shs382.52b to the authority. KCCA’s current budget for the financial year 2018/2019 is Shs477.62b.

The circular shows that of the Shs382.52b, Shs161.82b will come from the central government, Shs63.24 from the World Bank, Shs30.56b from the Uganda Road Fund (URF) and Shs126.9b from Non-Tax Revenue (NTR).
This means that KCCA has to set all its priorities for 2019/2020 within Shs382.52b budget.

The new budget was unveiled yesterday at City Hall during a meeting between Lord Mayor Erias Lukwago and a host of directors from the technical wing.

Mr Lukwago had called the meeting to interact with directors on how they run their different directorates, and also inform them of the budget process whose deadline is November 15.

Section 9(2) of the Public Finance Act (2005) requires all government agencies and local governments to submit their budget estimates to the Ministry of Finance.

Mr Lukwago noted that it is not safe for KCCA to keep relying on grants from donors yet government could provide money.

“The end result of this cut budget is that Kampala residents will be burdened to pay more taxes because the institution doesn’t have enough money.

We need to scrutinise this budget during our budget process and demand for more money which will enable us operate,” Mr Lukwago said.

Mr Lukwago also wondered why government keeps on slashing Kampala’s budget yet it’s the cash-cow of the country’s economy.

In her resignation last week, KCCA outgoing executive director Jennifer Musisi highlighted shortage of funding as one of the barriers to Kampala’s development.

KCCA heavily relies on NTR and grants and this implies that they can not manage to plug all funding gaps.

KCCA collects about Shs80b NTR but this is likely to drastically reduce because of the changes in the collection of city revenue.

For instance, KCCA will no longer have exercise on the revenue from taxis following the President’s directive to revert the mandate to Uganda Revenue Authority (URA).

Besides, KCCA runs 79 government-aided primary schools with more than 800,000 pupils, and eight health centres. However, their funding is still low.

The road construction in the city is being funded by World Bank under the second Kampala infrastructural and Institutional Development Project.

“Our only hope as an institution as far as revenue is concerned is the property tax, and this will affect us so much,” said Kennedy Okello, the Nakawa II councillor.

Mr Lukwago also expressed concern over KCCA’s strategic plan, arguing that the new plan, which is supposed to run from 2020 to 2025 is not incorporated in the next budget.

The first strategic plan was unveiled in 2014 and it’s supposed to expire in 2019.

Kampala Minister Beti Kamya confirmed the slashed KCCA budget in a telephone interview last evening.
“Budget cuts are normal and when it happens, it means that you have to cut your expenditure as well,” she said.

By Daily Monitor

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