Lawmakers have tasked the Ministry of Finance, Planning and Economic Development to put an end to the increasing domestic arrears amounting to Shs4.1 trillion.
The MPs on the Budget Committee were meeting the Ministry of Finance officials led by the Minister of State (Planning), Hon. Amos Lugoloobi on 27 October 2021 as he responded to concerns raised on the charter for fiscal responsibility for financial year 2021/22.
Amolatar District Woman MP, Hon. Agnes Atim said that domestic arrears are proof that there is a gap in financial management and a weakness in leadership by the ministry.
“There is no deliberate effort from the Ministry of Finance to clear domestic arrears because of the high level of corruption. Sanctions are imposed only on accounting officers leaving out ministry officials,” she said.
Hon. Dickson Kateshumbwa (NRM, Sheema Municipality) blamed the recurring domestic arrears to diversion of funds and inadequate management of contracts which he said are as a result of inefficiency in government.
“If for example you collect pay as you earn from people and you are supposed to remit it, why do you divert it? There is a lot of indiscipline and we want to see that action has been taken,” he said.
Mawogola County South MP, Hon Gorreth Namugga said that since the Ministry partly blames accounting officers for the increasing arrears, they should be dealt with accordingly.
“I don’t see any commitment as far as the ministry is concerned. Accounting officers do not perform because when they do something wrong, they are simply transferred. They need to have a proper strategy to handle the accounting officers who do not perform,” Namugga said.
The Minister attributed the increasing arrears to some accounting officers who he said are responsible for non-remittance of tax deductions on salaries and development projects.
“Domestic arrears also result from court awards because of the inadequate management of construction contracts, unpaid land compensation or not resolving disputes prior to judicial involvement, and frequent issuance of orders of mandamus against government,” Lugoloobi said.
Lugoloobi said that in line with Domestic Arrears Strategy 2021, a two-pronged arrears strategy was adopted to clear the outstanding domestic arrears.
“One focuses on the phased clearance of the existing stock arrears in the medium term. The second focuses on management control measures to stop the accumulation,” said Lugoloobi.
The Permanent Secretary in the Ministry of Finance, Ramadhan Ggoobi said that there is need for the Executive, Parliament and Judiciary to find practical ways of stopping the domestic arrears.
“This leakage is everywhere and it is too much. We shall try as much as possible to pay the arrears beginning with the ones we owe less. We have agreed with the Attorney General on a payment schedule,” he said.