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MPs Divided Over Government Move to Borrow to Pay Salaries

Minister Matia Kasaija

Parliament has on Tuesday probed Matia Kasaija, minister for Finance over move to borrow domestically over Shs700bn to finance the 2017/2018 budget and among others pay salaries.

Members of Parliament sitting on Committee on Budget and Committee on National Economy tasked Kasaija and his junior minister David Bahati to vividly provide supporting documents on how this loan amounting to Shs736bn will be used. On 9th February 2018, David Bahati, State Minister for Planning tabled on the floor of parliament this loan request which was tasked to Committee of National Economy for scrutiny.

During the meeting, Kasaija said that there is need to undertake extra borrowing of Shs736bn in order to finance the budget to the end of the 2017/18 Financial Year in order to enable smooth running of government operations.

“The projected revenue shortfalls and additional pressures have resulted into fiscal adjustments. However, given the limited options for cutting the budget, there is need to undertake additional borrowing to finance critical government operations for the remaining period of this financial year,” Kasaija said in his brief.

He also refuted media reports that the said over Shs700bn is only meant for payment of salaries, saying that only 1% (About Shs48bn) of the money will serve that purpose while the rest will finance on-going infrastructures projects whose certificates will fall due this financial year.

Kasaija rallied MPs both on Committee on National Economy and Budget to accept their loan request lest tax payers will pay heavily in penalties.

“Don’t dismiss this borrowing because if you do and I don’t pay URA certificates then in the next 3months I will pay Shs60bn in penalties,” Kasaija said.

The loan request however, left tempers flaring from the MPs who even requested that Kasaija resigns.

“It is a big shame that this government has been reduced to borrowing to pay salaries, yet recently, they were bribing MPs to pass the constitutional amendment. These excuses don’t hold water and shouldn’t be entertained, anybody that decided to recruit when the salaries hadn’t been budgeted for should be held accountable,” Ayivu County MP Bernard Atiku said.

“Did you project for the recruitment? Why did the Permanent Secretary recruit without money? If we begin borrowing money for salaries, then we are finished. Kasaija should resign for failing to manage resources Ugandans have given to him,” Susan Amero, Amuria Woman MP said.

National Economy Committee Chairperson Syda Bbumba added that government’s move to borrow domestically is likely to cripple the private sector.

However, Ibanda North County MP Guma Gumisiriza warned fellow MPs against threatening to reject the loan.

“We should sympathise with the Minister. We shouldn’t dismiss the request simply because a few mistakes have been made. He isn’t asking this money to take to his constituency,” Gumisiriza said.

 

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