New districts too costly – finance

Although Minister Adolf Mwesige projected a business-as-usual demeanor as he tabled a motion for creating new districts on Tuesday, he faces resistance from within his own government.

The Observer can reveal that the finance ministry has warned the local government minister about the cost of splitting the country into more struggling units. Mwesige’s motion, tabled in parliament on Tuesday seeks to create 25 new districts beginning next financial year. This would shoot the number of districts from 112 to 137.

Earlier, Mwesige had written to the ministry of finance, planning and economic development, seeking a go ahead to create the new districts over the next four financial years.

“Reference is made to the cabinet memorandum 150 (CT2015) which was presented, discussed and cleared by cabinet, yesterday, August 17 for creation of 25 new districts effective 2016/17,” Mwesige’s August 18 letter to the minister of finance, planning and economic development partly reads.

President Museveni is understood to have convened a crisis cabinet meeting on August 17, to respond to pressures from MPs who last week shot down Mwesige’s motion for the creation of 12 new municipalities.

The MPs’ anger was drawn by government’s reluctance to create 23 districts that were proposed in 2013. From the cabinet meeting, according to contents of Mwesige’s letter to the minister of finance, he was directed to create four districts of Kagadi, Kakumiro (from Kibaale district), Omoro and Rubanda from Gulu and Kabale districts respectively, effective July 1, 2016.

“The purpose of this letter is therefore to request you to issue a certificate of financial clearance, creating the 25 districts with effect from 2016/2017,” Mwesige wrote.
The letter further suggested that Mwesige needed the clearance before he went to Parliament later that day to table the motion.

RED LIGHT

Keith Muhakanizi, the finance ministry’s permanent secretary and secretary to the treasury, wrote back urging the local government minister to drop his motion.

“I have noted the budget implication for creation of one new district is Shs 16.63bn and Shs 59.25bn in the first year of operation which translates into Shs 1.465 trillion for the 25 districts,” Muhakanizi wrote.

The figures, Muhakanizi noted, included costs required for creation and operation of the district headquarters, offices of the Electoral commission, police, internal security, district hospitals among others.

“I wish therefore to reiterate my earlier concerns raised in my letter of July 27, on the creation of new municipalities, that costs for creation of new administrative units have become excessive, exerting pressure on the resource envelop and therefore unaffordable,” Muhakanizi wrote.

“Given the commitments government has undertaken in infrastructure development, the national budget can no longer accommodate the additional expenditures arising out of the creation of new administrative units [counties, districts, municipalities and cities],” Muhakanizi further wrote.

“The purpose of this letter is therefore to inform you as above and to advise against the creation of more administrative units,” he added.

DEFIANT

Without the much-needed clearance from finance, Mwesige took his motion to Parliament and on the floor, his shadow counterpart, Betty Nambooze Bakireke (Mukono municipality) asked him to table the clearance alongside his motion.

Mwesige told Parliament that it was not necessary because the proposed districts would not become operational until next financial year. Nambooze remained wondering how the districts would be operationalised because the involved costs are not reflected in the medium-term expenditure framework (MTEF).

The MTEF is a finance performance and monitoring tool developed by the World Bank. It reflects the annual, rolling three year-expenditure planning and also sets out the medium-term expenditure priorities and hard budget constraints against which sector plans can be developed and refined. Nambooze also wondered why the 9th Parliament was overstepping its mandate by deliberating on issues for the next Parliament and government.

“I think the motion is to hoodwink those agitating for the districts,” Nambooze told The Observer yesterday.

“I think it is a campaign promise which might be fulfilled or not because government has made it a fashion to make promises at campaign time which will never be fulfilled. This is what happened in 2005 during the amendment of the constitution when they promised regional tier governments.”

sadabkk@observer.ug
http://observer.ug/news-headlines/39411-new-districts-too-costly-finance