AGRICULTURE PUBLIC EXPENDITURE IN UGANDA Godfrey Bahiigwa PMA Secretariat Ministry of Agriculture, Animal Industry and Fisheries ILRI Campus, Addis Ababa May 11, 2009

Notes from PER in Uganda 2007 Increasing funding is not enough, increasing efficiency in resource use is very important Resource allocation process between Ministry of Finance and Agriculture needs improvement Ministry of Agriculture needs to improve its planning, budget execution and monitoring Local government planning and monitoring need to be strengthened

Status of Public Spending in Agriculture Ag. PE is 3.8% of national budget in FY 2008/09 Ag. PE will be 3.3% of national budget in YF 2009/10 Ag. PE projected to be 5.0% of national budget in 2011/12 With COFOG definition Ag PE is higher, but only for comparative purposes, not aligned to national budgeting processes

Planning and Budgeting Issues There is a delink between MAAIF plan and spending => related to low resources and budgetary indiscipline Planning and resource allocation processes are not transparent, even within MAAIF DSIP revision and implementation will try to improve these processes

Public Investments by MAAIF Agricultural advisory services (NAADS Agricultural research and technology development (NARS) Regulatory services and quality assurance Agricultural inputs (e.g. improved seed) Disease and pest control Quality planting and stocking material Water for agricultural production (incl. conservation and irrigation) Agricultural mechanization Infrastructure supportive of commodity value chains Policy coordination and institutional strengthening

Complimentary Investments Required by Agriculture Rural transport infrastructure Rural financial services Agro-industrial development and trade Rural electrification Natural resource use and management Land access and use Agricultural education

Funding Agriculture in the MTEF In 2008/09 FY agriculture’s share of the national budget is about 3.8%, but projected to be about 3.3% in FY 2009/10, a decline, yet agriculture is touted as a priority! However, based on economic modeling, to achieve an annual growth rate of 6% requires an annual increase of the agriculture budget by 26%. At this rate, the share of the budget would be 14% of the national budget by 2015.

DSIP Requirements vs MTEF Allocations (UGX Bn) 2009/10 2010/11 2011/12 DSIP needs 373.9 389.6 429.3 MTEF allocation 278.8 316.1 372.9 Funding gap 95.1 73.5 56.4 Finding gap (%) 25.4 18.9 13.1

DSIP Requirements vs MTEF Allocations (UGX Bn) 2009/10 2010/11 2011/12 DSIP needs 373.9 389.6 429.3 MTEF allocation 278.8 316.1 372.9 Funding gap 95.1 73.5 56.4 Finding gap (%) 25.4 18.9 13.1

Looking Ahead on PERs PERs definitely useful as monitoring instruments and can inform the budgetary processes Need to strengthen analysis that links spending and outcomes at sectoral level as well as economy-wide Analysis of expenditure sequencing would be helpful, given budget constraints Analytical capacity is weak at national level => how do we get it improved? ReSAKSS?

THANK YOU