Delayed budget deliberations to impact implementation
The delay in debating the 2025/2026 fiscal year (FY) is likely to harm its implementation, warns Graham Hopwood, the executive director of the Institute for Public Policy and Research (IPPR).
This follows an almost two-week delay by the finance ministry in sharing the budget documents with members of parliament after it was tabled in late March.
As a consequence, Hopwood said it will likely only pass the National Council, where a second round of debates is scheduled, by the end of May.
“It will have a negative effect on the implementation of the budget because the financial year has already started on 1 April. By the time the budget is passed by the National Council, it may well be the end of May,” Hopwood explained.
He explained that the delay has resulted in offices, ministries and agencies (OMAs) having no clear guidelines on what their spending limits are.
“This means that OMAs will not be operating on the new spending levels until then. Ideally, we should switch to passing the budget at the end of the calendar year so that the financial year starts on January 1 or February 1 at the latest,” Hopwood said.
“This would lead to more accurate spending of the budget and less likelihood that funds will be returned to the treasury unspent,” he added.
Clarity lacking
Swanu lawmaker Evalistus Kaaronda said the budget lacked clarity in terms of how the government would utilise money availed to it by finance minister Ericah Shafudah.
“The Appropriation Bill consists only of one single-page document with a list of amounts allocated to ministries and agencies. The ministerial budget statement lays out the thinking behind the amounts but does not define how the money will be raised, the risks involved and how each ministry will spend the allocated amounts,” Kaaronda said.
The lack of clarity is a further concern in light of the repayment of the US$750 million Eurobond, which the government must redeem later this year.
“External borrowing, especially the Eurobond, for instance, is due for [payment] later this year. What were the terms of borrowing and how do we reduce the appetite for borrowing? The mid-term review budget – the fiscal policy arrangements were not given together with the budget. Some of these are being electronically shared with us. We have not heard or received anything after the minister recalled what she shared with parliament,” Kaaronda noted.
Ready to go
The ministry of finance, for its part, said it has made all the relevant documents available to allow debates to start around the budget, which was scheduled for yesterday.
“As you are aware, the minister of finance tabled the budget duly upon the entry of the eighth administration. Prior to that, as well as subsequently, much work has gone in to align the budget with the policy ambitions of new frameworks such as National Development Plan 6 whilst also providing to the new members of parliament the required informative briefs on various aspects thereto,” the ministry said.
"The ministry of finance is working to ensure that the National Assembly is fully prepared to resume the debate on 8 April 2025."
This follows an almost two-week delay by the finance ministry in sharing the budget documents with members of parliament after it was tabled in late March.
As a consequence, Hopwood said it will likely only pass the National Council, where a second round of debates is scheduled, by the end of May.
“It will have a negative effect on the implementation of the budget because the financial year has already started on 1 April. By the time the budget is passed by the National Council, it may well be the end of May,” Hopwood explained.
He explained that the delay has resulted in offices, ministries and agencies (OMAs) having no clear guidelines on what their spending limits are.
“This means that OMAs will not be operating on the new spending levels until then. Ideally, we should switch to passing the budget at the end of the calendar year so that the financial year starts on January 1 or February 1 at the latest,” Hopwood said.
“This would lead to more accurate spending of the budget and less likelihood that funds will be returned to the treasury unspent,” he added.
Clarity lacking
Swanu lawmaker Evalistus Kaaronda said the budget lacked clarity in terms of how the government would utilise money availed to it by finance minister Ericah Shafudah.
“The Appropriation Bill consists only of one single-page document with a list of amounts allocated to ministries and agencies. The ministerial budget statement lays out the thinking behind the amounts but does not define how the money will be raised, the risks involved and how each ministry will spend the allocated amounts,” Kaaronda said.
The lack of clarity is a further concern in light of the repayment of the US$750 million Eurobond, which the government must redeem later this year.
“External borrowing, especially the Eurobond, for instance, is due for [payment] later this year. What were the terms of borrowing and how do we reduce the appetite for borrowing? The mid-term review budget – the fiscal policy arrangements were not given together with the budget. Some of these are being electronically shared with us. We have not heard or received anything after the minister recalled what she shared with parliament,” Kaaronda noted.
Ready to go
The ministry of finance, for its part, said it has made all the relevant documents available to allow debates to start around the budget, which was scheduled for yesterday.
“As you are aware, the minister of finance tabled the budget duly upon the entry of the eighth administration. Prior to that, as well as subsequently, much work has gone in to align the budget with the policy ambitions of new frameworks such as National Development Plan 6 whilst also providing to the new members of parliament the required informative briefs on various aspects thereto,” the ministry said.
"The ministry of finance is working to ensure that the National Assembly is fully prepared to resume the debate on 8 April 2025."
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