Various Government Departments Fail To Absorb Funds

Government pays Shs150 billion every fiscal year, in interest, for loans that are not used.

This has been revealed by the David Bahati, the minister of state for Planning.

As the financial year comes to a close, it has been revealed that government departments have “failed to absorb” Shs7.8trillion out of the Shs12 trillion Uganda borrowed from international lenders over the last five years.

The money is meant for the reforms in the land’s sector, accountability programmes as well as for the construction of roads and power projects, among others.

Bahati has blamed poor contract and project management and implementation for the poor absorption rates.

He says the other reasons are changes in the design of the projects for which the money was borrowed, commitment to multiple projects and lack of capacity within government to absorb the funds.

His remarks come at a time when many government departments, which have for the last one month have been presenting 2015/2016 fiscal year budget framework papers, are claiming they are underfunded.