BREAKDOWN! Inside Uganda government budget for FY2024/25

Uganda’s Finance Minister Matia Kasaija on Thursday, June 13, 2024, presented a record Shs72.136 trillion National Budget for the 2024/25 financial year that he said will be anchored on promoting four key growth drivers.

These are; agro-industrialisation, tourism development, mineral development, including oil and gas; and science, technology and innovation (STI), under the acronym ATMS.

The minister said: ”These are the anchor sectors that are going to propel Uganda to a 500-billion-dollar economy in the next one-and a-half decades.”

“Madam Speaker, these are the ATMS that are going to mint money for Ugandans next financial year and in the medium term. The detailed enabling policies, interventions and actions will be contained in the forthcoming 4th National Development Plan (NDP IV),” Kasaija added.

The total government expenditure for FY 2024/25 is projected at Shs72.136 trillion, of which the total appropriation is Shs37.56 trillion and the statutory expenditure is Shs34.756 trillion.

Wages and salaries are projected to amount to Shs.7.926 trillion. non-wage recurrent expenditure is projected at Shs 17.454 trillion, development expenditure from own resources at Shs 6.152 trillion, external project financing is Shs 9.584 trillion, appropriation in aid is Shs 293.9 billion, while external debt repayment will amount to Shs 3.149 trillion.

Domestic revenues amount to Shs 31.982 trillion, of which Shs 29.366 trillion will be tax revenue and Shs 2.616 trillion will be non-nax revenue; Budget Support  is Shs 1.394 trillion; Domestic Borrowing  will be Shs 8.968 trillion and Treasury bonds for settlement of Government outstanding obligations to Bank of Uganda as at 30th June 2024  will be Shs 7.779 trillion.

The domestic refinancing of maturing domestic debt will be Shs 12.022 trillion; Petroleum Fund drawdown will be Shs115.4 billion; Project support (external financing) is Shs 9.583 trillion; and Local Government revenue collections will be Shs 293.9 billion.

The breakdown

Mr Kasaija said that the National Budget for the financial year 2023/24 was intended to deliver on NDP III priorities and the promises made under the NRM Manifesto for 2021–2026. These include prioritisation of healthcare, education, water, sanitation and hygiene.

He said the new budget seeks to consolidate those achievements.

“I have provided Shs10.216 trillion for these priorities, which is 27 percent of the national budget,” he said.

Health sector

Of the Shs10.2 trillion, a total of Shs2.946 trillion has been provided for the health sector for the construction and rehabilitation of more health infrastructure and provision of medical equipment to improve quality of care and provision of specialised healthcare. These include, among others: the Uganda Cancer Institute and regional cancer centres; the Uganda Heart Institute, Intensive Care Units and an imaging centre for referral hospitals.

Others are provision of essential medicines where an additional Shs 100 billion has been provided, and improvement of the welfare of the health workers, including medical interns and doctors designated as senior house officers.

“I have provided more wage allocations to facilitate the recruitment of staff for the upgraded HC IIIs,” he said.

Others are construction, rehabilitation and equipping of dilapidated hospitals across the country including in the Kampala Metropolitan Area and establishment of a Pharmaceutical Industrial Park; and strengthening the National Drug Authority Regulatory Framework.

Education

For education, the government has provided Shs 2.497 trillion to further improve the quality of education, and the following are among the priorities: Supporting the new curriculum for S1-S4 students; Operationalisation of all the 111 seed secondary schools and completing the 27 seed secondary schools under the UGIFT Programme; and commencing the construction of 60 secondary schools and expansion of 61 existing secondary schools under the Uganda Secondary Education Expansion Project.

Others are providing loans to 5,192 degree and 1,125 diploma students who are on the Government-funded loan scheme, both continuing students and new beneficiaries; and take-over of Bunyoro and Busoga Universities.

Social protection

For social protection, the minister said the government will continued with the provision of the Senior Citizens Grant to 439,069 older persons across the country amounting to a cumulative total of Shs 565.7 billion.

Government will also continue to support the youth and women beneficiary groups using the recovered funds from the Youth Livelihood Programme (YLP) and the Uganda Women’s Enterprise Programme (UWEP). For greater efficiency, management of the two programmes (YLP and UWEP) has been unified.

“Madam Speaker, I have provided an additional Shs 355.79 billion for social protection next financial year,” he said.

Water and sanitation

On water and sanitation, the minister said clean water coverage will increase to 70 percent and 85 percent in rural and urban areas, respectively, in the next financial year.

This will be through construction of large solar-powered water supply systems in 19 districts that are currently at less than 50 percent water coverage, Completion of the construction of 31 town water supply systems and sanitation facilities, Construction of 17 rural water supply systems in the refugee-hosting districts and Progress the construction of 26 water supply systems at various stages in various areas.

Climate change mitigation and environmental protection

In the next financial year, the government has provided Shs 516.78 billion for climate change mitigation, natural resources, environment and water resources management.

“Madam Speaker, to support the restoration of our environment and reverse the effects of climate change, Government shall undertake the restoration of 42,450 hectares of degraded wetlands along the Awoja, Kandekye-Ruhorobero, Nchwera, Chambura, Kiruruma, Naigombwa, Kibimba, Tochi, Aswa, Sezibwa, Mayanja, Muzizi, Mpanga and Lumbuye water systems. 51. In addition, Government shall demarcate a 750-kilometre boundary with concrete pillars along the following wetlands; Kibimba, Tochi, Sezibwa, Mayanja, Muzizi, Awoja, Mpologoma, Ishasha, Kandekye-Ruhorobero, Nchwera, Chambura, Kiruruma and Naigombwa,” Kasaija said.

Wealth creation

On wealth creation initiatives,  Shs 1.059 trillion has been provided next financial year to benefit more households under the Parish Development Model.

“Government will also ensure effective implementation of Pillar One which includes input certification, provision of extension services, storage, value addition, and market linkages,” he said.

An additional Shs 100 billion has been provide under Emyooga to support more Ugandans to create wealth and boost their incomes. Next financial year, Government will continue to capitalise the Agricultural Credit Facility (ACF) with an additional Shs 30 billion.

Government is going to further capitalise  Uganda Development Bank (UDB) with another Shs 55 billion. Government is also in the process of acquiring for UDB credit lines worth Shs 1.083 trillion to lend more to wealth creators.

The minister also said Next financial year, Government and Bank of Uganda are going to relax the requirements to ensure increased uptake of the SBRF to support SME growth. the Small Business Recovery Fund (SBRF) was set up to provide soft-loans to SMEs that had suffered financial distress during COVID-19.

Agro-industrialisation

The government has also allocated a total of Shs 1.878 trillion towards deepening agro-industrialisation with increased focus on commercialisation and value addition in agriculture.

Tourism

In FY2024/25, the minister has provided Shs 289.6 billion to the tourism development programmes to undertake the following: i. Support international and domestic tourism marketing and promotion activities; ii. Modernise our tourism products to make them more competitive. These include completion of the pier and related infrastructure at the Source of the Nile; upgrading the Uganda Museum; construction of 8,000 metres of climbing ladders and boardwalks on the Rwenzori Mountains to make hiking safer; Continue with the grading, supervision and classification of tourism facilities to enhance the quality of services and ensure adherence to the required global standards; iv. Complete the upgrade of the Uganda Hotel and Tourism Training Institute infrastructure in an effort to make it an International Centre of Excellence for training and skills development in tourism and hospitality; and v. Enhance the conservation of Uganda’s 22 Wildlife Protected Areas.

An additional Shs 1.629 trillion has been provided for several critical interventions associated with tourism including support to Uganda Wildlife Authority, construction of tourism roads, road rehabilitation and upgrade under Kampala Capital City Authority, support to AFCON‘27 and completion of key stadia, strengthening security, law and order in our tourism destinations, and extension of the internet to tourism destinations, among others.

“In particular, I have provided an additional Shs 55 billion to Uganda’s Missions Abroad to support the Uganda Tourism Board (UTB) to market Uganda to potential tourists, market our exports and attract more investors,” the minister said.

For science, technology and innovation.

Next financial year Government is going to support Kiira Motors with Shs 32.5 billion to complete the plant and access working capital.

Next financial year, Government has provided an additional Shs 50 billion to complete the capitalisation of Presidential Initiative on Banana Industrial Development (PIBID) plant in Bushenyi to transition into a self-sustaining business.

Mr Kasaija said the Government is in the process of finalising equity acquisition in Dei Biopharma Ltd in exchange for its Shs 723 billion investment in Matugga. Shs 75 billion has been provided next financial year to improve coffee value chain development.

Shs 3.3 billion has been provided for Space Programme activities next financial year.

Minerals sector

For Minerals sector, the government has allocated Shs 41.55 billion to undertake the following interventions for further mineral development: i) Fast-tracking quantification and market studies for all minerals for the purpose of investor promotion; ii) Operationalising the National Mining Company; Commencing construction of the Busia and Moroto beneficiation centres; and strengthening the Ntungamo and Fort Portal centres; and vi) Facilitating private sector participation in exploration, mining and value addition to minerals.

Oil and gas

The government has provided Shs 920.86 billion for the oil and gas sector to prioritise Development of the East African Crude Oil Pipeline (EACOP) hub in Tanga; continued construction of the EACOP including the necessary infrastructure to facilitate adherence to high quality environmental standards; Procurement and dissemination of the 57,000 Liquefied Petroleum Gas (LPG) cylinders to promote clean cooking; and Establishment of the Petroleum Geoscience Laboratory; and Equity contribution for the Refinery Project.

Infrastructure

During the FY 2024/25, more focus will be put on maintenance of the roads we have built, building of a few new strategic roads, accelerated rehabilitation of the Metre Gauge Railway, and commencement of construction of the Standard Gauge Railway.

Government has provided a total of Shs. 4.989 trillion for  starting and completion of several road projects.

Shs 162 billion has been provided for completion and operationalisation of Kabalega International Airport in Hoima; and plans are underway to acquire at least two (2) mid-range aircraft and 2 cargo aircraft to facilitate exports in the medium term

ICT

The government has provided over Shs 246 billion to continue developing the ICT and digital transformation through the further expansion of internet connectivity and digital infrastructure across the country; continuing the rollout of digital services across Government to improve efficiency of service delivery, transparency and accountability and leveraging Business Process Outsourcing (BPO) and ICT to create employment opportunities for the young people.

ENERGY DEVELOPMENT

Government has provided Shs 982.56 billion to undertake  Increased access to electricity through grid expansion and connectivity projects; More investment in the construction of transmission and distribution networks targeting load centres to promote value addition; Improving the quality of power supply through the systematic operation and maintenance of existing power infrastructure; Increasing access to clean energy by supporting clean cooking technologies; Development of five (5) micro-grid power plants using wind and solar hybrids in Karamoja; and Preparatory activities for the 8,400MW Nuclear Power Plant in Buyende District.

SECURITY, GOOD GOVERNANCE AND RULE OF LAW

The government has provided a total of Shs 9.588 trillion, of which Shs 481.4 billion is for the administration of justice to ensure that Uganda remains a peaceful and accountable country with law-abiding citizens.

Some of the money will go towards improving the welfare of the military, police, prisons, ISO and ESO personnel through salary enhancement.

NATURAL DISASTER RESPONSE AND MANAGEMENT

 Next financial year, the government has provided Shs 18.1 billion plus a Contingency Fund of Shs 146.26 billion to support disaster response and management, including Operationalisation of the National Disaster Risk Management Plan; Support 50,000 households with food and non-food items across the country; Provision of funds to Uganda Red Cross Society to support disaster victims; and  Supporting the resettlement of 1,000 households that were displaced by landslides and floods in the Elgon Region including the districts of Bududa, Manafwa, Bulambuli, Namisindwa and Sironko.