By Ahura Mark
Uganda this week refunded to Ireland €4 million (Shs17bn) of aid support funds which were misappropriated in the office of the Prime Minister ,The Deputy Secretary to Treasury Keith Muhakanizi was quoted promising that the Ugandan government will pay other countries which will demand their donations back .
“I am confirming that we have paid the Irish, we shall pay the others (donors) who want their money back,” he said, adding: “We are making a lot of progress on that front.” Muhakanizi was quoted as saying after the donation refund the Ireland government . As critics are still questioning where the government got the funds to pay back to the donor country , Economic experts also warn that refunding donations could be bad to the economy. Professor Augustus Nuwagaba was on Thursday quoted saying the move is likely to weaken the shilling even further against the dollar.
On top of weakening the shilling ,he says this could lead to an increase in inflation rate which been on the downward trend since midlast year.According to the Uganda National Bureau of Statistics report,the Annual Headline Inflation rate for the year ending December 2012 rose to 5.5% from 4.9% registered for the year ended November 2012,.The Annual Core Inflation rate, which excludes food crops, fuel, electricity and metered water rose to 4.6% for the year ending December 2012 from the 3.9% registered for the year ended November 2012.
Government should note that many members of the civil society had earlier asked it to get all the funds to pay back to donors from money restored from corrupt officials .This noble decision was watered down when government decided to get the funds to pay back from the tax payers money -The state treasury.The state treasury has already lost 25% in cut aid ,thus getting more money from the same source means more government funded projects are set be limited by funding unless more donors show up to cover up the gap.
With the Anti-Corruption Act , 2009 being activated to deal with corrupt officials in the country ,together with other efforts from the civil society like the Black Monday movement ,let a ‘lost fund recovery account ‘ be happened to see that any money meant to pay back misused donations is withdrawn from this account.
Such an intervention if well implemented will not only prevent the economy from heading to a financial crisis but will also limit the misuse of public funds.