The opposition has said that instead of Government investing money in yet another poverty alleviation programme- Parish Development Model (PDM), it should consider establishing a national price stabilization fund as an alternative development approach.
The shadow minister for finance in Parliament, Muwanga Kivumbi reasoned that programmes such as the PDM have over the years failed to achieve the target of increasing household income therefore putting in place a national price stabilization fund for a basket of commodities would go a long way in cushioning the population from the vagaries of demand and supply.
He argued that a price stabilization fund would encourage productivity because for example, agricultural producers would not fear losing out due to inflation and oscillating prices especially caused by forces of demand and supply as well as natural disasters.
Muwanga advises that the fund should target developing buffer stocks and regulating releasing products into the market to ensure a sustained market, durable pricing system, discourage hoarding especially for grains and undue speculation by middlemen.
“Interventions such as the Microfinance Support Centre, Pride Microfinance Limited and Uganda Women Entrepreneurship Program should be combined to re-establish a national cooperative bank and dedicated product lines developed to target the diversity in the informal sector,” said Muwanga.
“Hence based on the diversity in sources of livelihood of targeted beneficiaries, they would be able to benefit from the different products based on their competitive and comparative advantage,” he added.
Muwanga who is also the Butambala County MP said that there’s also need to consider transforming the agricultural credit facility into an agricultural bank and also to develop a fertilizer factory to rejuvenate the already degraded land in many parts of the country.
Muwanga presented the statement this afternoon during a plenary session chaired by Speaker Jacob Oulanyah providing an alternative approach to the PDM that is yet to be rolled out.
The PDM comes in an addition to the many already failed poverty alleviation initiatives that have been introduced by Government to enhance community development through finance initiatives, the most recent one being the Emyooga program.
It seeks to increase household income mainly through agriculture and financial access. The funds to finance the programme are to be mobilized from the different livelihood programmes as well as amalgamation of the existing wealth funds. UGX 453bn was expected to be raised from the amalgamation and of that, UGX 404bn was to be used as a revolving fund.
However, a number of the legislators have expressed concern over the feasibility of the new programme based on the fact that many of them had not achieved their goals and those revolving funds set up by Government have very poor recovery rates.
For instance, in 2019/20, the Youth Livelihood Programme recovered only shs37.04 billion out of shs93.3 billion disbursed while the Uganda Women Entrepreneurship Fund only recovered shs16.9 billion out of shs66.7 billion disbursed.
Muwanga informed the House that scrutiny of the Parish Development Model reveals that it does not address the prevailing bottlenecks hindering the transformation of agricultural enterprises into profitable ventures.
He said it was oblivious of the fact that the majority of the citizens who are engaged in agriculture require not handouts but rather an environment that makes agriculture profitable.
“While the agricultural sector needs quality inputs, extension services, insurance, arable land and financing, it should be noted that its potential is suppressed to a greater extent by unstable and unpredictable prices which have been depreciating over the years.”- He explained
He also said the Parish development model is just a replica of the Rural development strategy (RDS) adopted in FY 2005/06 and later the Economic Development Strategy (EDS) adopted in FY 2006/07. The aspirations of both strategies are similar to those of the pillars of the parish development model on production, processing, marketing, and access to rural financial services.
He further notified the House that the parish model that failed over 15 years ago has just been rebranded and reintroduced without assessing why it failed on its initial attempt. He said that it would have been prudent on the part of Government to evaluate this failure and other failed strategies such as Etandikwa, Bona bagagawale among others to inform the new initiatives.
Hon. Afidra Olema Ronald (Lower Madi County MP) also urged the Government to do a thorough research in each parish to ascertain how it can ensure the equitable development of all parishes in the country.
Butambala Woman representative, Aisha Kabanda in support of the alternative policy also tasked the Government to protect farmers from the many counterfeit products on the market. She said there were many fake products which are very affordable that farmers buy which ends up affecting agricultural productivity.