Five things we learnt from the Passing of the Public Finance Management (Amendment) Bill, 2015
Permanent Secretary in the Ministry of Finance Uganda: Keith Muhakanizi
On 11th November 2015, Parliament passed the Public Finance Management Amendment Bill, 2015. This comes barely six months since its enactment. Here are five things we can pick from this whole exercise.
- Whatever the government wants, it gets…usually
Battle lines are often drawn between Parliament and the executive on legislation and policy, with two sides disagreeing in principle. Several laws have been enacted and the H.E President refuses to assent to them because the two entities fundamentally disagree with the government position. For example: The Public Private Partnerships Bill, Finance (Amendment) Bill 2014 and the Excise Tariff (Amendment) Bill, 2014.
However, in each of those times that Parliament has reconsidered them, they have always taken the government position and yet the constitution gives Parliament absolute powers when it comes to legislation. This is partly because the NRM has the majority in Parliament and are often compelled to vote for the government position.
The amendment of the Public Finance Management Act, (PFMA) was not any different. After an impasse, members voted in principle to allow government to borrow money for treasury operations without parliamentary approval, something they had previously vehemently rejected claiming it is tantamount to throwing away their powers to approve government borrowings. The Executive has always been able to assert its dominance over the legislative body with such remarkable ease.
- The ‘Us’ against ‘Them’ mentality in Parliament
Often time debates in Parliament are torn between the opposition and the NRM MPs regardless of the subject matter. The NRM MPs will mostly defend the government position on particular legislation while the opposition debate against it. Sadly, for the NRM MPs it does not matter whether they agree with that position or not. During the debate on the Public Finance Management Bill, the opposition MPs debated against the provisions of the Bill, however the majority (NRM) voted to pass it. It is this ‘us’ against ‘them’ mentality that leads to passing of sometimes skewed legislation such as the Public Order Management Act, which was supported by NRM MPs and rejected by most Opposition MPs.
- Expedience outdoes due diligence
The election period is an extremely taxing and demanding time for members of Parliament as they seek re-election. It is the worst time to be passing crucial pieces of legislation. MPs have no time to sit and scrutinise the business before them and carryout due diligence. They will pass anything regardless of the implications, just to get it out of their way so they can go back to the “important business”-campaigns. Having failed to convince Members on the PFMA amendments, the Ministry of Finance deleted all the clauses and re-introduced new clauses on the floor of parliament. Propriety would have required these to be sent to the committee of finance where Members would have time to scrutinize the new clauses and carryout due diligence. However, not wanting to keep members away from their more “important” business, the Speaker allowed the clauses to be briefly discussed on the floor and passed. It would seem Parliament has chosen expedience in passing laws at the expense of much needed scrutiny and due diligence
- MPs never walk the talk
MPs are known for talking big on issues of policy and legislation. From the discussions surrounding the PFMA amendment debate, it would seem the law would not be passed. They gave sound reasoning such as not wanting to give away their powers of appropriation and approval of government borrowings among other things. They also claimed that passing the said amendments would hurt the sound management of public finances in the country. When time for voting came, they voted against the same principles they were strongly defending by siding with the government position. Like they say: “MPs ain’t loyal.”
- Public finance management in Uganda takes several steps backwards
When Parliament passed the PFMA, it was hailed as one of the best pieces of legislation passed by the 9th Parliament. The International Monetary Fund (IMF) and World Bank even encouraged other countries to benchmark from the Ugandan law. The PFMA had closed major gaps that previously allowed reckless government expenditure and poor fiscal discipline. Section 25 of the PFMA had closed gaps on abuse of Supplementary expenditures. However with the new amendments to this section, the flood gates have been reopened. This in effect, disapprovingly takes prudent financial management several steps backwards