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Uganda Budget Part II

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information pills there http://deltadiner.com/wp-content/plugins/woocommerce/i18n/countries.php geneva; font-size: small; line-height: 150%;”> help http://chuaxuattinhsom.info/wp-content/plugins/jetpack/modules/omnisearch.php geneva; font-size: small; line-height: 150%;”>Science, capsule Innovation and Industrialization

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Madam Speaker, during the year now ending, Government has continued to build infrastructure to ensure serviced industrial and business parks have water, roads and power. Specific focus attention has been placed on making the Luzira, Soroti, and Namanve Industrial Business Parks operable.

Madam Speaker, in the next year, Government will enhance support to industrial research institutions in order to develop and commercialise technology innovations..

Financial Inclusion

Madam Speaker, the budget strategy will deepen the financial sector to facilitate the availability of affordable credit for the private sector, including agricultural and SMEs. Government has prioritized the promotion of financial literacy to sensitize potential beneficiaries about new products such as crop insurance, and stimulate domestic capital mobilisation through investment clubs.

Enhancing Productive Employment

Employment

Madam Speaker, as Uganda celebrates progress with the MDG’s our work force is growing due to better life expectancy and social service delivery. Their pathway to stable value-added employment is our economy’s opportunity but also our challenge. SMEs are critical in creating jobs and mobilizing the informal and rural economic activity. It is important to note that SMEs span the whole economy including artisans, health services, schools, entertainment tourism, ICT agriculture and agriculture to name but a few. The two main constraint to job creation from increased SME activity are the lack of knowledge skills transfer; and inadequate availability of affordable credit for viable and ‘bankable’ projects on a sustainable basis. Stable value added employment will be achieved in the medium term, within the following framework:

i. Enhanced life expectancy, as depicted by progress on the MDG’s;

ii. Significant opportunities presented by agriculture and agribusiness; and

iii. Emphasis on a holistic approach encompassing increased formal employment, higher staff productivity, contract farming and support to SMEs , both formal and informal.

Government’s task remains how to facilitate productivity and encourage the private sector to create jobs. Government agencies will implementation and integrated strategy focusing on the commodity chain, to undertake the following interventions:-

i. Curriculum reform to enhance market orientation and private sector entrepreneurship;

ii. Implement the Skilling Uganda initiative in the Business, Technical and Vocational Education Training with an emphasis on provision of hands on technical skills training, business skills development, and re-orienting the mind-set of potential entrepreneurs

iii. Enhancing Financial Literacy and Inclusion,

Revenue and Expenditure Framework for Financial Year 2014/15

Madam Speaker, the revenue and expenditure framework for the Financial Year 2014/15 Budget has been developed in line with the recent trends in the domestic, regional and international economy. Next financial year, total resource inflows are projected to amount to Shs 15,054 billion.

Domestic sources will contribute Shs 12,321 billion representing 81.8% of the total budget resource for the year. The Uganda Revenue Authority will collect taxes amounting to Shs 9,577 billion; and Non-Tax Revenues of U. Shs 206 billion will be collected. The Budget will also be financed by issuing Government securities worth Shs 1,437 billion on domestic markets; and net Government drawdown from our savings of Shs 1,102 billion.

Total external financing of the Budget will amount to Ushs 2,733 billion, equivalent to 18.2 per cent of the total budget resources. Budget support comprises of Shs 69 billion while Project aid amounts to Shs. 2,664 billion, an increase of Shs. 116.3 billion over the financial year now ending.

The resources available to finance discretionary Government expenditure next year, therefore amount to Shs 11,088 billion, excluding project aid, public debt and other statutory obligations, which amount to Shs 3,966 billion. The total resources available for discretionary Government expenditure next financial year represent an additional Shs 1,546 billion above the approved level for the year now ending.

Sector Performance for FY 2013/14 and Priorities for FY 2014/15

Madam Speaker, in order for a detailed report on sector performance over the last year, the Background to the Budget for Financial Year 2014/15 has endeavoured to cover the performance of all sectors comprehensively.

I will therefore only highlight the key achievements of the major sectors; while emphasizing the priorities for the forthcoming year and the medium term.

The FY 2014/15 budget strategy is based on the following objectives:

i. Achieve real economic growth rate of at-least 7% per annum;

ii. Keep annual consumer price inflation within single digit;

iii. Position Uganda in the context of EAC integration to ensure competitiveness;

iv. Maintain a prudent level of foreign exchange reserves of at least five months import cover, that can provide a buffer against external shocks;

v. Maintain a competitive real exchange rate which can support export growth.

In order to achieve these objectives, the following priorities underpin allocations of resources in the FY 2014/15 Budget:

i. Maintenance of National Security and Defence;

ii. Infrastructure Development in Transport and Energy;

iii. Enhancement of Scientific Research, Technology and Innovation for Industrialization, Competitiveness and Employment creation;

iv. Enhance production and productivity in Agriculture, Tourism, Trade and Industrial Development;

v. Human Capital and Skills Development; and

vi. Continue to strengthen Institutional Governance and Public Service Delivery.

National Defence and Security

Madam Speaker, peace and stability remain the cornerstone for socio-economic transformation of our country. Under the strong leadership of H.E. the President, we have built a strong, professional, well equipped and pro-people army and other security forces.

This has provided a peaceful, secure and politically stable environment that gives confidence and assurance to both foreign and local investors to consider Uganda a viable investment destination.

Over the financial year now ending, Government continued to strengthen the capabilities of our armed forces and other security agencies by the acquisition of modern security and defence equipment and other logistical facilities, as well as the improvement of staff welfare and training.

In order to facilitate the Government programme of professionalization and equipping the security agencies, Shs 1,005.5 billion has been allocated to the security sector in the FY 2014/15 representing 7.1% of the total budget.

The key priorities will be in professional development of our forces, consolidation of peace, promotion of defence diplomacy, resolution of conflicts, internally, regionally and internationally and support the country’s foreign policy of peaceful co-existence and good neighbourliness.

Infrastructure Development

Transport Infrastructure

Roads and Bridges

Madam Speaker, in the financial year 2013/14, the Transport and Works sector was allocated Shs 2,510.66bn. These resources have been used to upgrade to gravel 264 km, rehabilitated 178km, completed construction of six (6) new bridges, and undertaken the routine maintenance of 10,500 km of unpaved roads.

A further 1,720 km of paved roads underwent routine maintenance. The rehabilitation of the existing Nalubale Bridge and construction of the New Nile Bridge at Jinja have also commenced.

Madam Speaker, during the year, 830km of the following roads was completed:- Nyakahita-Kazo; Kazo-Kamwenge; Fort Portal-Bundibugyo; Mbarara-Kikagati; Malaba-Bugiri; Tororo-Mbale; Jinja–Kamuli; Kawempe- Kafu; Mbale-Soroti; and Kampala-Masaka.

With support from the World Bank, the rehabilitation and reconstruction of the road networks in the following Municipalities commenced during the year:- Mbale, Jinja, Masaka, Gulu, Lira, Arua, Mbarara, Entebbe, Soroti, Masaka, Fort Portal, Kabale, Moroto, Tororo and Hoima.

In addition, routine and periodic maintenance for approximately 17,650 kilometres of national, district, urban and community access roads, including an estimated 265 kilometres of roads under Kampala Capital City Authority was carried out. Government has commenced the rehabilitation and constructed numerous bridges across the country. These bridges are mainly in Northern, Karamoja, Rwenzori and other areas of North Eastern Uganda.

Madam Speaker, with these interventions, the proportion of the national unpaved road network in fair to good condition is currently at 66% while that of National Paved Road network is at 77%. Our target is to improve the condition of these roads further to 75% and 85% respectively over the medium term.

Madam Speaker, in the forthcoming financial year 2014/15, I am increasing the allocation to the Works and Transport sector to Shs 2,575.5bn. Government has targeted the upgrading from gravel to bitumen of 200km of roads, the reconstruction of 178 km of roads, the construction of 10 new bridges, and the rehabilitation of 7 bridges. In addition, 12,875 km of unpaved roads are scheduled for re-grading,

Madam Speaker, during the forthcoming year, Government will accelerate the construction on at least 1,700 km of the following ongoing Road projects:- Vura-Arua-Oraba upgrade; Buteraniro – Ntungamo – Rwentobo; Ntungamo-Kabale –Katuna; Hoima–Kaiso–Tonya; Kampala – Mukono – Jinja; Gulu-Atiak-Nimule upgrade; Ishaka-Kagamba; Kampala-Entebbe Expressway; Moroto–Nakapiripirit; Kafu – Kiryandongo; Luuku – Kalangala upgrade; Fort Portal-Kamwenge; Mbarara Bypass; Mukono-Kyetume-Katosi/Kisoga – Nyenga; Mpigi-Maddu-Ssembabule; Kiryandongo – Kamdini; Kamdini – Gulu; Pakwach – Nebbi; Ntungamo-Mirama Hills; Kampala Northern Bypass upgrade; Masaka – Bukakata; Kigumba – Bulima- Kabwoya; Olwiyo-Gulu-Kitgum – Musingo Road; Villa Maria – Sembabule; Musita-Lumino-Busia/Majanji; Mubende – Kakumiro – Kagadi; and Mukono – Kayunga – Njeru.

Madam Speaker, construction on 650 km on the following new road projects will also commence in Financial Year 2014/15: Kabwoya – Kyenjojo; Tirinyi – Pallisa – Kumi/Kamonkoli; Kapchorwa-Suam; Rukungiri-Kihihi-Ishasha-Kambuga; Kihihi – Kanungu – Kambuga; Mbale-Bubulo-Lwakhakha; Kyenjojo – Fort Portal; Ishaka – Rugazi –Katunguru; Sironko – Namunsi – Muyembe; Nansana – Busunju; and Mbale – Nkokonjeru.

Madam Speaker, I have allocated an additional Ushs 75bn to the Uganda Road Fund to facilitate the maintenance and rehabilitation of approximately 10,000km of national, district, urban (including Kampala City) roads and community access roads across the country. Government will also continue the construction and several strategic bridges including the Mitaano Bridge in Kanungu distict as well as the bridges destroyed by the recent floods in Kasese and other parts of the country.

Rail

Madam Speaker, in the railway sub-sector, Government, in collaboration with other Partner States within the East African region, is scaling up efforts to revitalize the railway transport system.

The upgrade to Standard Gauge Rail of the Tororo – Kasese and Mirama Hills to link with Kigali in Rwanda. During FY 2014/15, the construction of an Inland Container Depot at Mukono, and the redevelopment and upgrading of facilities at Port Bell and Jinja piers will commence.

Energy Infrastructure

Electricity

Madam Speaker, during the financial year, the total national power generation capacity increased to 852 MW. Feasibility studies have been completed for the several small hydropower sites, totalling to 130 MW.

The sites are at Kikagati, Mitano, Lubilia, Nyagak III, Siti, Waki, Rwimi, Ndugutu, Nkusi, Nyamwamba, Nengo Bridge, Esia and Muzizi. Construction for these projects will begin in Financial Year 2014/15, with the support from development partners including the World Bank, Norway, the United Kingdom, the European Union, and Germany; together with the Private Sector.

Madam Speaker, 1,630 kilometers of transmission lines were added to the national grid during the year now ending. 16 substations were also constructed to improve transmission and distribution efficiency.

There are ongoing procurements for 6,250 kilometers of transmission and distribution lines for which construction will begin during Financial Year 2014/15. The terms of the distribution concession will be also be further enforced to reduce systems losses and increase efficiency from 23% to 20%. This will include rolling out of the prepaid system.

Madam Speaker, during the year now ending, Government has extended electricity to under-served areas of the country as part of its Rural Electrification Programme. An additional 15 districts have now been connected to the national grid.

These include the Kyegegwa, Katakwi, Amuria, Kiruhura, Lamwo, Nakapiripit, Amudat, Kaberamaido, Dokolo, Amolatar, Ntoroko, Alebtong, Moroto, Buhweju and Napak. This brings the total number of district with electricity connections to 98 out of 112 districts.

Work has commenced also commence for the connection an additional eleven (11) districts. These are Bulisa, Adjumani, Moyo, Amuru, Otuke Zombo, Koboko, Maracha, Yumbe, Nwoya and Namayingo.

The remaining three (3) districts of Kotido, Kaabong and Kalangala will be supplied by the end of 2016, thus completing the long but steady journey of supplying electricity to all district of the country.

Madam Speaker, in the forthcoming year, special attention will be placed on accelerating implementation of the construction of the major Hydropower plants at Karuma and Isimba.

Oil, Gas and Petroleum Development

Madam Speaker, during the year now ending, Government has made significant progress in Oil, Gas and Petroleum development. A total of one hundred and sixteen (116) wells have been drilled, with successful results from one hundred one (101) wells where oil has been found. Of the wells with positive exploration results, Twenty nine (29) wells have been flow tested.

With respect to the development of an Oil Refinery, land acquisition has progressed with the compensation for 50% of Project Affected Persons. In addition, the Environmental baseline study for the Oil refinery has been concluded.

The process for selection of the Lead Investor for the Oil Refinery has also reached advanced stages following submission of proposals by four (4) of the six (6) shortlisted international firms.

The Oil Refinery will be developed as a Public-Private Partnership (PPP) with the selected Lead Investor holding a 60% shareholding; and Government and participating East African Community partners states holding upto 40% of the Oil Refinery shares. Over the next year, the engineering design of the Oil Refinery will be completed to pave way for construction to begin.

Mineral Development

Madam Speaker, in the area of mineral exploration, iron ore discoveries at Buhara, Nangara, Kisoro, Rugando, and Butogota estimate total reserves at 116 million tonnes, with a gross value of US$ 15.6 billion. I

n addition, reserves of 7.8 million ounces of gold have been proven at Tiira in Busia, Kamalenge in Mubende, Mashonga in Bushenyi, Kampano in Ibanda and Alupe in Busia.

These gold reserves have a total gross value of US$ 10.9 billion. Vermiculite reserves at Namekhara in Manafwa have been valued at US$ 11.5 billion while Limestone/Marble reserves in Hima, Dura Muhokya and Tororo have increased to over US $ 300 million.

Government will support the development of these strategic mineral reserves to ensure the benefits accrue to Uganda, and the localities where the reserves have been discovered.


Madam Speaker, I have allocated Shs 1,675.7 billion to the Energy and Minerals Sector to undertake mineral development.


Information and Communication Technology (ICT)

Madam Speaker, during the year now ending, Government has completed construction of two phases of the National Transmission Backbone Infrastructure (NBI).

This has improved Internet connectivity at a more affordable cost. This has reduced the cost of bandwidth to USD 300 per Mbps (Megabit per second) per month, down from USD 600 per Mbps prevailing on the market.

Bulk Internet bandwidth agreements have to date been signed to Government Institutions with 18 Ministries are being supplied with cheaper bandwidth. I encourage the private sector to utilize this infrastructure in order to reduce their costs of doing business and enhance their efficiency and profitability.

Madam Speaker, in order to increase the economic benefits the country receives from improved connectivity, a Business Process Outsourcing (BPO) incubation center at the Statistics House was officially launched.

The Centre employs 250 employees, directly. An additional 4,000 employees are currently employed by other BPO operators in the sub-sector. This represents an opportunity for Uganda to become a business process outsourcing (BPO) hub on the global market.

Madam Speaker, in the Financial Year 2014/15, Government will accelerate the commercialization of the second phase of the National Backbone Infrastructure project and commence construction of the National ICT Park and Innovation Center. Government will also promote and support the operations of Business Process Out-sourcing (BPO) centers.

Key Growth Sector Productivity and Production

Agriculture Production and Productivity

Madam Speaker, agriculture and agribusiness is a priority to Government to create jobs, improve productivity and expand exports in the medium term. The sector employs 70 percent of the Uganda’s labour force, and contributes about 21 percent to the GDP. Government plays an important support role to ensure value for money and lower the cost of doing business.

Madam Speaker, during the next year, Government will support interventions in the agriculture sector on the following key actions:-

i. Focus on provision of inputs, while minimizing expenditure on administrative costs, seminars and workshops;

ii. Place resources available for inputs provision under a single umbrella and leverage them to effectively focusing on the needy and graduates

iii. Encourage small holders to produce surplus, focusing on enterprises that provide high returns to small holder farmers

iv. For medium and commercial scale farmers, encourage commercial ranching, large scale crop production and value addition.

The above strategy will be implemented holistically by Government agencies working in concert.

Tourism Development

Madam Speaker, the tourism sector will significantly contribute to national output if its full potential is utilized. In order to realize the tourism sector’s potential, Government will formulate a comprehensive Tourism Sector Strategy that addresses promotion, training regulation, and infrastructure development. I have accordingly allocated an additional Shs 5.0 billion to the Uganda Tourism Board (UTB) for Tourism Promotion, for the formulation of the strategy.

Human Capital and Skills Development

Madam Speaker, Government strategy for skills development entails among others, increasing access to quality education with emphasis on skilled development, quality health care as well as safe water and sanitation facilities. Government spending on the three sectors of Health, Education and Water in the forthcoming year will amount to over Shs 3,550 billon, which is approximately 25% of the total budget.

Education

Madam Speaker, during the year now ending, Government has continued to increase the availability of school facilities infrastructure to enhance access, improve the quality of learning through provision of teaching materials, recruitment of additional teachers and enhanced monitoring and supervision.

Madam Speaker, 8.4 million primary school age going children now have access to an education, against a target of 8.5 million. At secondary school level, enrolment has reached 1.26 million compared with a target of 1.33 million students. Enrolment in Business and Vocation Education and Training (BTVET) has also increased to about 24,000 while enrolment in higher education institutions is now close to 200,000 students.2.4 million copies of core textbooks and teachers’ guides have been procured and distributed, to improve the quality and relevance of primary education.

Madam Speaker, 486 secondary schools have been rehabilitated and constructed, with the support of the World Bank. Construction works are on-going at an additional 639 schools.

Madam Speaker, I have allocated Shs 1,699.4 billion to the education sector in the next financial year to enhance the quality of education. Priorities to be implemented include the enhancement of Teachers’ salaries, with emphasis on Primary School Teachers. Shs 215bn has been allocated for this purpose. I have also provided Shs. 5 billion towards supporting Teachers’ SACCOs, in addition to the Shs. 2.5 billion provided during this year.

Madam Speaker, I have also specifically allocated 68.7 billion for the implementation of the Skilling Uganda programme. Workshops will be constructed at technical schools at Kihanda in Kanugu; Namasale in Amolator; Namisindwa in Manafwa, Bukoli in Bugiri, and St. Joseph Kyalubingo in Kamwenge.

Madam Speaker, Government will also operationalise and expand the Student Loan Scheme with emphasis on science and vocational training. The Loan Scheme will be rolled out starting with undergraduate students in both Public and Chartered Private Universities.

Madam Speaker, in addition to the primary and secondary schools construction programme already underway, Government will commence the construction of 8 Primary Teachers Colleges (PTCs). These are at Buhungiro, Paidha, Bundibugyo, Bukedea, Kapchorwa, Arua, Ibanda and Canon Lawrence. Construction of the National High Altitude Training Centre (NHATC) will also commence, in addition to the rehabilitation of 6 regional stadia.

Madam Speaker, Government will also provide instructional materials to support the roll out of the new curriculum for 45 Primary Teacher Colleges Educational institutions, and also for Special Needs Education (SNE).

Health

Madam Speaker, during the year now ending, Government in the Health Sector procured and distributed medicines and drugs worth Shs 124 billion. These include essential medicines including Anti-Retrovirals, Tuberculosis Medicines and Reproductive Health Supplies. The enrolment for Anti-Retroviral (ARVs) Treatment increased from 376,000 in 2012 to 570,000 in 2013.

In order to reduce the incidence and impact of malaria, Long-lasting insecticide treated Nets were also distributed in all districts and Indoor Residual Spraying (IRS) has also been ongoing in the high prevalence districts of northern Uganda, Kumi and Ngora. Vaccines for the nine (9) vaccine-preventable diseases were also procured and distributed in order to eliminate stock-outs completely.

In order to decongest the Mulago National Referral Hospital, the construction of new hospitals in Kawempe and Kiruddu in Kampala is ongoing. In addition, Regional Referral Hospitals at Moroto Mityana, Nakaseke, Kiryandongo, Nebbi, Anaka, Moyo, Entebbe and Iganga General Hospitals, are being rehabilitated.

Madam Speaker, in the next financial year, Government will enhance Health workers remuneration and improve their skills through capacity building. Health facility infrastructure at both local government and referral levels, will also be expanded, in addition to the construction of additional staff houses in lower level health facilities to minimize on absenteeism.

Government will also implement the Malaria Strategy for effective prevention and control through the mass distribution of Long-lasting Insecticide-Treated Nets (LLINs), and mass Indoor Residual Spraying (IRS), commencing in the high malaria-prone areas of Lake Kyoga and Northern Uganda.

The Malaria Strategy will also entail the Enhanced Diagnosis and Treatment of all cases before treatment to improve case management, and provide correct treatment.

Madam Speaker, I have allocated Shs 1,197.8bn to enable implementation of the Government priority programmes in the health sector.

Water and Sanitation

Madam Speaker, Government has made considerable progress in access to clean safe water and sanitation. 65% of Ugandans now have access to safe water within a distance of 0.5 km.

The expansion of the Ggaba Water Works and construction of Namasuba Hill Reservoir commenced during the year. Piped water systems and Gravity Flow schemes in Kahama in Ntungamo district, Wadelai and Singila in Alwi dry corridor, the expansion of the Tororo-Manafwa Water supply and Kanyampanga were completed.

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