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.

  1. 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.

  1. 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.

  1. 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

  1. 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.”

  1. 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