New budget process guidelines released for 2010/11 financial year

Government has officially launched the budgeting process for the 2010/11 financial year calling for dialogue within government institutions. The process that was launched on Tuesday this week is expected to allow linkage between planning and budgeting.
James Musoni, during this year’s budget day (File photo)
James Musoni, during this year’s budget day (File photo)

Government has officially launched the budgeting process for the 2010/11 financial year calling for dialogue within government institutions.

The process that was launched on Tuesday this week is expected to allow linkage between planning and budgeting.

According to officials budget performance in the previous years, has been seriously affected by poor planning and this has been facilitated by preparing budgets that have no realities on the ground.

To avoid such inconsistencies government institutions have been called upon to hold a discussion at sectoral level on priority activities as this will be a basis for submission of budget requests in response to the second budget call circular.

“The objective for this measure is to reinforce the link between planning and budgeting by encouraging sectoral spending agencies to start working together in a sector and identify priorities to be achieved within a constrained resource envelope,” Elias Baingana, the Director General of National Budget at Ministry of Finance and Economic Planning (MINICOFIN) told Business Times in an earlier interview on Saturday.

The findings from Joint Sector reviews have not adequately informed the budget process in the past Baingana said.

As such the new budget calendar requires districts and line ministries with affiliated budget agencies to undertake expenditure reviews that will become the basis for sector reviews.

“All sectors shall be expected to produce sector review reports that reflect the budget framework for the sector and budget submissions will draw significantly from this report,” he emphasized. 

Baingana also noted that the circular is not intended to seek budget submissions from budget agencies but is aimed at giving advance information to facilitate timely coordination and effective planning within sectors.

“This will allow formulation of policy based budgets within individual budget agencies at a later stage,” Baingana said.
Allocation of resources in the new budget process shall also be subject to presentation of specific and defined out puts to achieve during the financial year.

To ensure effective implementation, activities that will be financed within the 2010/2011 budget should be “carefully” prioritized giving special attention to “work in progress and existing commitment.”

“Government is committed to implementing results- based budgets to fast track poverty reduction and effectively monitor progress towards achieving targets,” he added.

Baingana said that budget performance in the previous years, has been seriously affected by poor planning and this has been facilitated by preparing budgets that have no realities on the ground.

As a result, it will be a requirement for all budget submissions for the forthcoming years to be accompanied by a draft action plan and procurement plan corresponding to the submission.

“We had taken it for granted in the past that institutions have their plans and they have carefully done their plans and what they are going to do – is get money and do the activities that they have planned for,” Baingana said.

“We need to see if you are requesting money to construct a road, have you done feasibility studies? We are talking about value for money. This time if we see you are not prepared, without having made proper analysis- to have a plan of action, we shall say you do not need this money,” he added.

According to Baingana, weak planning accounts for underutilization – low absorption of the budget in some institutions.

“You get money that you have not actually adequately planned on how to use it .When it comes to spending it you find that actually you are not ready to spend it, because it requires an international tender which requires three months, by the time you finish the procurement process, it is already another financial year.” he said.

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