Thursday, June 5, 2014

New Fuel card to Reduce Government Expenditure on vehicles



New Fuel card to Reduce Government Expenditure on vehicles

By Adellah Agaba

Uganda Debt Network would like to applaud and welcome the move by Ministry of Finance Planning and Economic Development for taking heed to the uproar by citizens and tax payers on Government extravagant expenditure especially on Government Vehicles fueling and service. This was captured in the partnership of Ministry of Finance and United Bank of Africa (UBA) to issue out a fuel card that will manage fuel consumption by Government Vehicles in a move to reduce too much expenditure and as part of finance reforms in the Ministry as stated by state Minister for Investment Gabriel Ajedra.
In 2013, Uganda Debt Network in partnership with the Red Pepper ran a six months campaign on the “Misuse of Government Vehicles” highlighting Government’s high expenditure on a big fleet of vehicles which in time is yielding impact. 

The government policy instrument on vehicles provides for the standardization of vehicles of government officials. However, this policy instrument continues to suffer abuse by the same officials who are obligated to keep government property in good condition. The fuel guzzling, costly vehicles end up making their maintenance costly to the disadvantage of tax payers in the country who still receive poor service delivery at the end of the day.
With the ever-increasing fleet of government vehicles, maintenance costs equally escalate in terms of garage costs, fuel, oils and lubricants. This then bears an implication on Government expenditure and consequently hikes our already huge domestic debt. When all is said and done, Uganda finds herself locked in this vicious cycle of debt and debt repayment. Fiscal indiscipline is one of the main causes of debt arrears as indicated in the Auditor General’s Report of 2010. 

Government’s unbalanced expenditure has led to increased instances of hefty allocations to public administration in the annual budgets and more stringent allocations to service delivery say in hospitals, where the common man benefits and this questions government capacity in setting its priorities. As per the Public Service Standing Orders, in addition to the maintenance of inventories for vehicles, plant and other equipment; log books or operating records must be maintained by recording a vehicle’s history, performance, servicing, overheads, and repairs in sufficient details for periodic assessments to be made of its performance, compared to its cost of upkeep. A public officer shall be held financially responsible for losses incurred on Government property which are due to his or her neglect or fault. 

By end of Financial Year 2005/06 there were at least 8,090 Government vehicles on Uganda’s roads, burning through Ug Shs 29 billion on fuel and another Ug Shs 29 billion on fleet maintenance. The size of fleet and cost of maintenance was even higher since this cost excludes Government motorcycles at the national and Local Government levels. Government also spent Ug Shs 18 billion on purchase of new vehicles, bringing the aggregate expenditure to 76 billion in the same FY. In Financial Year 2006/07, the fuel bill was approximately Ug Shs 24 billion while that for vehicle maintenance stood at t Ug Shs 68 billion; bringing total expenditure to Ug Shs 92 billion. By Financial Year 2009/10, Government expenditure on vehicle maintenance alone had escalated to over Ug Shs 100 billion per the Auditor General’s report June 2010.  

Since the figures have been showing a drastically increasing trend, Uganda Debt Network welcomes the move by Ministry of Finance to regulate Government spending on fuel which is a start of what most people would call patriotism. In respect to the 1995 Constitution of Uganda; Article 17 (d) and (i) which provides for protection and preservation as well as combating corruption and misuse or wastage of public property, it’s upon our public servants to take heed and save the tax payers’ money by spending responsibly. 

The writer works with Uganda Debt Network

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