Commentary    21st Jan, 2018

Budget Priorities For FY 2018 / 2019

In December 2017, the Minister of Finance submitted to the floor of Parliament the 2018/19 NBFP indicating the FY revenue projections, the sectoral priorities and expenditure plans. PPI presents an overview of the NBFP, analysis of the FY 2018/19 sectoral priorities and expenditures as well as key policy issues.

by Emmanuel Kitamirike

1. Introduction

Article 9 (3) of the Public Finance Management Act (PFMA) requires the Minister of Finance to prepare a National Budget Framework Paper (NBFP) which is consistent with the National Development Plan and the Charter for Fiscal Responsibility. The NBFP is government’s overall plan for revenue generation and expenditure for the subsequent fiscal year. The framework must clearly provide linkages between government’s public policies to the identified priorities in the annual National Budget. In December 2017, the Minister of Finance submitted to the floor of Parliament the 2018/19 NBFP indicating the FY revenue projections, the sectoral priorities and expenditure plans. PPI presents below an overview of the NBFP, analysis of the FY 2018/19 sectoral priorities and expenditures as well as key policy issues;

2. Overview

The proposed overall budget for the fiscal year 2018/19 is estimated to be UGX 29,274.06 billion from UGX 29,008.54 billion in 2017/18. Indicating a slight nominal increase of UGX 265.52 billion (1%). As such, domestic revenue is expected to contribute, UGX 15,547 billion (53%), of which UGX 15,130 billion is tax revenue and UGX 418 billion is non-tax revenue.

Revenue Projections for FY 2018/19

External support, 23% is expected from different development partners mainly to support several ongoing and new projects. In addition, budget support from the World Bank is part of the PTA loan that was disbursed in July 2017 which will also form part of the budget. It is estimated that close to 20% will be acquired domestically in the form of borrowing and refinancing. While the rest will be Appropriation in Aid (AIA). For the coming fiscal year, AIA will be remitted to the consolidated fund, previously, it was spent at source by various MDAs.

3. Projected Sector Share Of The National Budget

The FY2018/19 budget has not significantly changed from the previous fiscal year regarding the overall allocations. Transport and works, energy and mineral, interest payment as well as education remain the 4 highest allocations with a combined share of UGX: 12,355.8 billion representing 42 percentage allocation.

Top Four Allocations with a Lion’s Share of the Budget

The Transport and Works sector continues to take the lion’s share of the national budget (UGX 4,706.7B (21.4%)) and the Energy & Mineral Development sector (UGX 2,529.2 (11.5%)) takes the third place after interest Payments (UGX 2,700.7 (12.3%)) in line with Uganda’s strategic policy of infrastructure development. Education come in 4th UGX 2,419.2 (11.0%).

Top four Sectoral Allocations against the remaining 13

The 5 Least Funded Sectors for FY2018/19

Similarly, the sectors at the bottom end of the national cake have remained the same as was in the 2017/18 financial year.

The Four Least Funded Sectors

4. Losers and Winners of the FY2018/19 National Budget

Different sectors have experienced losses or wins as per the budget framework paper, although the intricacies pertaining to the losses are not laid out.

Read more here.

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