Publication: Uganda - Fiscal Policy for Growth : Public Expenditure Review 2007, Volume 2. Main Report
Date
2007-06-24
ISSN
Published
2007-06-24
Author(s)
World Bank
Abstract
Uganda needs to increase infrastructure
investments if impressive growth is to continue. But the
Budget is showing increasing signs of stress from
expenditure pressures and fiscal tightening. Recent
increases in employee costs in central Government functions
of public administration, justice law and order, defense,
prisons and police have deteriorated the composition of the
Budget from the perspective of growth. In common with global
experience in tight fiscal circumstances, public
infrastructure spending is getting squeezed. These
expenditure trends suggest a further squeeze on
infrastructure and maintenance is inevitable, in which case
growth could slow down. This report concerns how should
Uganda respond to these fiscal challenges? Whereas there is
scope for prudent new concessional borrowing for
infrastructure, disbursement rates in infrastructure
projects are too low, making it a priority to address
constraints to effective spending. As part of a fiscal
strategy for growth, Uganda needs in the short to
medium-term to rapidly improve revenue performance without
taxing key growth sectors, and to shift the composition of
spending towards infrastructure. A compositional shift will
require deep public sector reforms, early action on
postponed reforms to public administration, and a working
program to reduce waste and increase the efficiency of
public expenditures, including in Poverty Alleviation Fund
(PAF) priority sectors and agencies. A reduction in waste
and an increase in public sector efficiency will ultimately
require more accountability for the delivery of quality
public services than is evident in Uganda today. It will
also require a much more systematic effort by spending
ministries and agencies: a more structured and a much more
strategic approach to public service efficiency from the
ministry of finance could be built into budget framework
papers as well as preparation of the next Poverty
Eradication Action Plan (PEAP).
Citation
“World Bank. 2007. Uganda - Fiscal Policy for Growth : Public Expenditure Review 2007, Volume 2. Main Report. © Washington, DC. http://openknowledge.worldbank.org/entities/publication/ab478e6a-521a-5b06-a8e7-c2709208108a License: CC BY 3.0 IGO.”