The Ministry of Works and Transport has sounded alarm bells over financial challenges following the integration of the Uganda National Roads Authority (UNRA) into its operations.
Minister Gen Edward Katumba Wamala informed Parliament that the ministry has inherited a debt of approximately Shs 1.3 trillion from UNRA.
This liability he said is impacting ongoing infrastructure projects, with many contractors halting work due to unpaid dues.
Worse still, the minister revealed that the debt accrues an average interest of Shs 280 million daily, exacerbating the financial strain.
“If we do not retire that debt, then all the contracts we are running cannot carry on. Most of the contractors actually have laid down their tools as we speak,” he said.
“I have raised this issue with the committee on infrastructure.”
Rationalisation Policy and RAPEX
The integration of UNRA into the Ministry of Works and Transport is part of the government's broader Rationalisation of Government Agencies and Public Expenditure (RAPEX) policy.
Initiated in February 2021, RAPEX aims to streamline government functions, eliminate redundancies, and reduce public expenditure.
As a result, several agencies, including UNRA and the Uganda Road Fund, have been dissolved, with their responsibilities reverting to their respective parent ministries.
This move is intended to enhance efficiency and accountability within the public sector.
Proposed Solutions and Legislative Actions
To address the inherited debt and ensure the continuity of infrastructure projects, Minister Katumba Wamala proposed two solutions:
Debt Settlement: Allocating funds to clear the Shs 1.3 trillion debt, enabling contractors to resume their work without financial hindrances.
Budget Realignment: Transferring the budget votes for UNRA and the Uganda Road Fund directly into the Ministry of Works and Transport to maintain operational continuity.
House reassures
In response, Deputy Speaker Thomas Tayebwa assured Parliament that the transfer of funds for entities affected by RAPEX to their respective ministries would be addressed promptly.
“On Thursday this week, we should be able to handle and complete the transfer of money which was meant for all the entities affected by RAPEX to the mother ministries,” the speaker assured.
He also suggested exploring the issuance of an infrastructure bond, citing Kenya's tax-exempt infrastructure bonds as a model for raising funds more affordably.