12 January 2013

Uganda: 'Aid Cuts Will Be Lifted'

THE government is confident that recent aid cuts will be reversed, allowing for the budgeted expenditures for this year, secretary to the treasury Keith Muhakanizi has said.

At the end of last year, several donors announced aid suspensions amounting to about $260m (sh700b) in protest over corruption in the Office of the Prime Minister and the public service ministry.

"We are confident with all measures we have taken, donors will disburse money between now and the end of the financial year in June," he told a news conference at the finance ministry.

Muhakanizi announced several measures to manage public finances, which he said would help in preventing a repeat of the recent scandals.

He said the remedial measures would include reviewing weaknesses in the public financial management system, special investigations into 16 ministries and Government agencies, integration of the Government payroll and pensions in the integrated financial management system.

In addition, he said the Government had opened an account in Bank of Uganda to begin recovery of misappropriated funds in the OPM and other ministries.

Administrative action has been taken against affected officials, the Police were carrying out investigations to determine whether there was any criminal liability and their assets frozen pending the completion of inquiries.

Muhakanizi said the Government has already set aside sh38b meant to refund donors with the Irish government already receiving about sh14b to the Irish government.

He said the refunds are coming from a supplementary budget.

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