A report from the Committee on Finance, Planning and Economic Development reveals that the Ugandan government will need 12 years to clear domestic arrears exceeding Shs13.8 trillion.
The report, presented by the Committee’s Deputy Chairperson, Moses Aleper, cited the Auditor General, who noted that domestic arrears had risen from Shs10.5 trillion in the 2022/2023 financial year. Aleper highlighted that the government has allocated Shs1.1 trillion for clearing these arrears in the 2025/2026 financial year.
“While this is an improvement over last year’s allocation of Shs200 billion, at this rate, it will take over 12 years to clear the arrears if no new ones are accumulated,” Aleper explained.
The committee recommended that the Minister of Finance present a comprehensive plan to clear domestic arrears in both the medium and long term. It noted that the failure to pay these arrears is crippling the private sector and hindering economic growth.
Deputy Speaker, Thomas Tayebwa, acknowledged the increased allocation but said more effort is needed. “By the time small companies supplying at the district level are paid, the money cannot even cover the interest that has accrued,” Tayebwa said.
MP Peter Okot criticised officials in the Finance Ministry for failing to supervise accounting officers effectively. “Accounting officers were warned not to commit government where there is no money. Does this mean the Finance Ministry has failed in its supervisory role?” he asked.
Tororo District Woman MP, Sarah Opendi, called on the government to reduce domestic arrears by 50 percent, warning that failure to do so could lead to the collapse of businesses. “There must be a deliberate effort to remove wasteful expenditure to tackle domestic arrears. Businesses employ Ugandans, and people start businesses to sustain themselves, their families, and pay taxes,” Opendi stated.
MP Agnes Auma urged the Ministry of Finance to prioritise releasing funds to government entities to avoid the accumulation of domestic arrears. “Domestic arrears are becoming a shame to the country and its leaders. These activities are budgeted for; where is the money going? This must be taken seriously, and the Minister of Finance must commit,” she said.
The Minister of State for Finance (General Duties), Henry Musasizi, said that the ministry plans to clear all verified domestic arrears in three years. He added that the increased allocation of funds is a positive development. “Domestic arrears under the former Uganda National Roads Authority have been substantially addressed, with about Shs2 trillion allocated,” Musasizi said.
He also noted that the Shs13.8 trillion figure reported by the Auditor General needs further verification. “Different reports show varying figures, ranging from Shs13 trillion to Shs10 trillion and even Shs5.7 trillion, depending on which audit report is considered,” Musasizi explained.
