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Government Plans to Amend Public Finance Law


Hon. Katuntu on PMFA RESIZED - Public Finance Management Act to be amended - minister
PHOTO — Parliament of Uganda Portal

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During a plenary session on March 5th, 2024, the State Minister for Finance, Planning, and Economic Development (General Duties), Hon. Henry Musasizi, revealed that the finance ministry is embarking on consultations to amend the Public Finance Management Act of 2015. The purpose of these amendments is to ensure effective alignment with the budgeting process conducted through the Legislature.

Addressing the parliamentarians, Minister Musasizi emphasized the need for amendments, considering that nearly eight years have passed since the enactment of the law. He highlighted the evolving nature of financial management and the necessity to adapt legislation accordingly.

The decision to amend the Public Finance Management Act comes in response to concerns raised regarding the alignment of parliamentary rules with the government’s program-based budgeting framework. Hon. Abdu Katuntu, Chairperson of the Rules, Privileges, and Discipline Committee, presented a report proposing the alignment of parliamentary procedures with the budgeting framework.

The Deputy Speaker, Thomas Tayebwa, expressed concern over discrepancies between the National Budget Framework Paper (NBFP) and the Budget Committee’s report. He noted the disparity between the program-based approach of the NBFP and the sector-based nature of the Budget Committee’s report, which contradicts the provisions of the Public Finance Management Act.

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In response to these concerns, Budget Committee Chairperson, Hon. Patrick Isiagi, acknowledged that program-based budgeting was not fully integrated into all stages of the budgeting process. He suggested that aligning parliamentary rules with the program-based framework would necessitate amendments to the Rules of Procedure to establish program committees.

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Presenting the committee’s findings, Hon. Katuntu recommended amendments to the Public Finance Management Act to legalize program-based budgeting. He emphasized the need for a comprehensive review of government ministries currently organized on a sector-based basis to transition them to a program-based structure.

The Deputy Speaker granted the finance minister a year to conduct consultations and present a report to Parliament on the proposed amendments to the Public Finance Management Act. He stressed the importance of periodic updates on the progress of the consultations.

Minister Musasizi reassured that the identified mismatch between the parliamentary rules and the budgeting process would not impede the current budgeting procedures. However, the proposed amendments aim to ensure smoother coordination and alignment between legislative and budgeting processes for more effective financial management.

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