parliament
OpEd

Uganda needs to prioritise supervision of public investment ventures

Jesse David Kabagambe

As It is widely acknowledged, there is a scaling-up need of public investment in physical and social infrastructure that should be done at-most apex in both low and middle income countries (emerging economies), in order to achieve sustained link between public service delivery, growth and development.

This has been witnessed by the mushrooming of a mix of projects, both tangible and intangible, worldwide and mostly on the African continent where development finance partners have offered support, aiming at accelerating financing moderities to flexibly address this factor of development financing, in forms of Official Development Assistance (ODA), Intergovernmental transfers, Capital financing, Grants, Sovereign debt to make Public investment a reality.

An outcome infrastructure mix such as; Transport network (Road, Railway, Air and water), Schools (from primary to Tertiary institutions), Health (From Grade1 to Referral hospitals), ICT (Communication and transmission), Human development (skills and capacity Building), Energy (power generation, Oil and Gas), Security; a case of countries like Ethiopia, Rwanda, Kenya, Angola, Ghana have really transformed positively.

The recently joined girders at the Jinja Nile Bridge.

The good news is that by improving public investment management, by emerging economies can greatly increase economic growth rate and social impact.

As Uganda plans to achieve its vision of middle class economy by 2020, arriving at this, will entirely depend on the degree to which the State manages its public investments.

Development finance availability as depicted in the financial budgets has positively increased from 4.3 to 7.6 percent of GDP within a 10 years period, indicating increment in capital investments by 126%.

The intention of allocations, as reflected in the paper work of the National Development Plan, depicts what Uganda needs to embark on to attain its 2020 vision, but financial indiscipline indicators are cropping up day and night, showing poor public investment.

Empirical evidence has it that, up to 36% of the planned spending does not materialize, with the bulk of this under-spending recorded in the major sectors of health, public service commission, agriculture, energy and transport.

Budget execution driven by overall inefficiencies in investments and consumption has increasingly become a nightmare an indication of a decline in efficiency utilization of public capital thus curtailing the desired socio-economic transformation.

It’s on record that the revenue base has been threatened with citizens going negative after they discovered that their tax remittances have been abused.

This automatically will affect the revenue capacity and base of the economy, which will drive the level of government debt over 50% of GDP and this alone is an economic threat.

Also taking a reflection on the operationalization of the projects is something to my opinion that needs to be studied and emphasized.

Truly its un believable and un heard of to find that technocrats from the engineers to drivers (as witnessed onsite) are all foreigners, indicating unbalanced employment levels.

Ugandans are left to take the casual jobs, also about 70% of the materials are imported, with minority or no local companies contracted for the investments projects.

This depicts high rate of financial drain of huge sums of money got through either by sovereign or domestic borrowing, with little or none left for Ugandans, who bears the burden to pay back the borrowed funds,
not isolating the rampant and ever increasing corruption at every level and corner of public investment management process, this virus generates unfavorable impacts on both short and long-term economic growth and sustainable development through increased production costs, decreased national and foreign investment, inefficient allocation of national sources, increased inequality and poverty in the society and uncertainty in the decision making budgetary processes.

For Public investments to be productive;
(a) there is need have an effective management of public investments at all stages of the project cycle, In order for these investments to contribute to increased growth and improved productivity.

(b) Need to incorporate all stakeholders, to scrutinize, to carry out checks and balances, to evaluate the designs in order to produce strong and responsive results, in order to reduce on unnecessary costs and delays.

(c) Harmonization of standards and guidelines is critical for quality control, greater tracking, and monitoring of results. A shared understanding is needed across institutions related to identification, appraisal, implementation, evaluation of projects.

(d) serious institutional and capacity building by government setting-up construction units mainly in the strong institutions like; Police, Army, Districts and purchase machinery, have our well trained Ugandans in all fields, on board to own and take full control adhering set ethical values as per the institution attached trust me this will promote efficiency, effectiveness and responsiveness and reduced illicit financial drain from the state reserves to international firms as a bigger percent of public funds will remain within the economy.

Take an example of Rwanda and Ethiopia where 80% government projects  are managed and operationalized by state owned institutions (army), or by domestic private-public covenants with approximately 20% or less left out for few foreign companies.

Recently President Yoweri Museveni stated that no government institution should import furniture when our own Prisons can do whatever is need perfectly.

More so Uganda Police is now using its engineering department for the construction of housing estates, believe it the best will be attained, our policemen will earn greatly and improve their economic power which in short and long run drive our economy to stability if this is done at wide scope.

The newly-constructed Nateete Police Station was built by the police engineering unit.

(e) For control of rampant corruption, need to strengthen the legal and regulatory framework by mapping conducts and risks of corruption at each phase of the investment cycle, mitigate the risks, and to redress them by addressing each of the conducts and risks previously identified.

Developing codes of conduct party to the investment process and engagement, have clear mission of the organization, as well as its values and principles and the linkages with standards of professional conduct, visible guidelines on probity, guidelines on how the stakeholder deal with the ethical dilemmas, prejudices and grey areas that are encountered in everyday work and put in effect Sanctions for integrity breaches, including administrative, disciplinary and criminal Punishments for integrity breaches aiming to recovering any mismanaged funds above 100 percent.

Uganda needs to have better oversight in public investment management system’s positively correlated to how project’s are scrutinized and selected, tendered, implemented, subsequently operated, effectively completed on schedule and sustainably maintained to arrive at the required cost benefit analysis results.

KABAGAMBE JESSE DAVID jziine@yahoo.co.uk, is a PhD Researcher @ Jomo Kenyatta University of Agriculture & Technology)

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