Once upon a time June 8th will have been something of a public holiday. In the weeks leading up to it the price of sugar, salt, milk, petrol, diesel and kerosene would go up as traders hedged their bets that the Finance Minister may open a pandora’s box- for better or worse. These days however the air of bad omen does not hang around market stalls nor do worried traders sit by their radios as if listening for signs of news-good or bad. Since the liberalisation of the 90’s, the free market happened to Uganda. In 1993 Uganda licensed the first FM stations, today there are some 280 licenses. Every county has a radio station.
At one point when the first cellular phone company came to Uganda ( charging about 5 million shillings for ugly Erikson phones) in 1994, Uganda had less than 10,000 landlines. Today, well there are close to 11 million mobile phones. So somethings have been changing rapidly when economic growth is at 6% per annum.
If the government was a “tenacious” convert to the free market and liberal policies as Prof Mahmood Mamdani would say, it has had trouble with its new faith. Consider this. The intention for the 90’s market reforms were meant to reduce the size of govermment ( many workers were sent home), reduce participation in particularly the production and sell of goods ( state parastatals were stripped and sold) and enhance its ability to make policy and regulation.
A variety of problems have arisen from this. For one the government sector did not shrink, it grew. Uganda has more government workers and institutions today than it had when it sought to shrink the state sector in the 90’s. The bloated public administration sector is the main headache for the government. Most of so-called liberal budgets lately has been government spending on itself- and less oiling the wheels of the free market.
Moreover, aside from corruption and other “leakages”, the government has become a worse regulator. Many areas of state spending have become padded booths for insiders to feather their nests, cornered markets were regulators are weaker than the regulated.
The soft state in the free market era has been a mixed blessing almost as bad as the hard state- from the days of the command economy. It boils down to one problem really when the new finance Minister Maria Kiwanuka ( my last meeting with her was at an EAC do in Daresalaam and before that when we discussed my working for her radio station Radio One in the mid 90’s. I did not get hired) throws her numbers about is how much by way of strengthening the capacity of the government system- the budget delivers.
Aside from spending on priority areas the budget should address the following; regulation, training of government workers, shedding off of employee baggage in non-priority areas, enhanced use of new technology in accountability and procurement processes and greater control within the vast decentralised system that has spawned out of the political economy of patronage of the ruling party.
This of course is too much to ask. The government often praises as it’s achievement the glitter of new businesses that the private sector has brought to Kampala and other towns. Ms Kiwanuka knows a lot of this has come because the government left the private sector alone. One would hope her first budget put the government behind the private sector not in its way.
This of course will not happen. At least not in this budget.
