Parliament has authorised government to borrow up to $100m (about Shs380b) from the domestic market to fund classified military activities.
The request by Finance minister Matia Kasaija was, however, controversially passed as a number of MPs told the Deputy Speaker, Mr Jacob Oulanyah, that there was no debate.
“We had discussed this matter and there should be no further discussions,” Mr Oulanyah said before putting the question for members to adopt the committee report. The ‘Ayes’ took the day.
Government indicated an urgent need for the funds so as “to improve the capability of Uganda’s defence and security forces” and “to enhance … security infrastructure.”
In the report prepared by the Committee on National Economy, MPs highlighted the need to support the loan without revealing the details since it is under classified expenditure.
“This expenditure was not budgeted for and is a fiscal deficit, since it is over and above the approved budget for this FY 2018/19,” the report reads in part.
“These funds are required immediately, and since they cannot be raised by an increase in tax collection or external borrowing, all of which take long to accomplish, hence the request to borrow locally,” the report adds.
The committee stated that the security sector plays a vital role in defending and protecting people and their properties, the sovereignty and territorial integrity of Uganda, as well as ensuring peace and security for socio-economic development.
The committee, chaired by Nakaseke North MP Syda Bbumba, also noted that the Defence classified expenditure has grown from Shs347b in FY 2O17/18 to the Shs640b in the current financial year.
The approval brings the defence classified budget to a total Shs1.02 trillion for the current year, further pushing the ministry’s overall budget to Shs2.4 trillion from the earlier Shs2 trillion that was approved in May last year.
Uganda currently has a domestic debt of Shs13.4 trillion compared to only Shs 5.42 trillion in 2017.
In the presence of other loan requests, domestic debt is projected to hit a record Shs15.5 trillion by June 30.
–Daly Monitor
