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Civil society ask government to follow law on Petroleum Fund withdrawals


Uganda’s national oil revenue committee. There is a call for transparency in petroleum matters.


NEWS BRIEFS: Anti-corruption civil society agencies have warned the government against withdrawing money from the Petroleum Fund without following a structure to oversee the expenditure as required by law.

Transparency International Uganda and the Anti-Corruption Coalition Uganda top executives said Oct.21 they were alarmed at the recent announcement that the government plans to withdraw up to Shs 450bn from the Petroleum Fund to transfer it to the Consolidated Fund to finance the 2019/20 budget.

“We have noted that the planned withdrawal is contrary to the provisions on the 2015 Finance Management Act which clearly states how the money from the Petroleum Fund should be withdrawn and used,” they said.

According to Section 58 of the Public Finance Management Act, 2015, “withdrawals from the Petroleum Fund shall only be made under authority granted by an Appropriation Act and a warrant of the Auditor General.”

While section 59 (1) states that: “The money withdrawn from the Petroleum Fund to the Consolidated Fund to support the annual budget shall not exceed the amount authorized by Parliament in the Appropriation Act.”

Transparency International Uganda Executive Director, Peter Wandera calls
on the government to halt plans for withdrawing Shs450million for the
Petroleum Fund until the Investment Advisory Committee is fully functional
as per the Public Finance Management Act 2015. This was during a press
conference held on Oct. 21 in Ntinda. INDEPENDENT /ALFRED OCHWO

This is not the first time the government has raided the Petroleum Fund to withdraw money to fund budget activities without putting in place structures necessary to oversee the investments.  In 2018, Shs 200bn was withdrawn from the Petroleum Fund to fund the FY 2018/19 budget.

The civil society agencies say no country can survive the oil curse and “Dutch Disease” if corruption and bad governance are allowed to infiltrate the oil industry.

“If corruption infiltrates into the oil sector, it will make it impossible for Uganda to exploit its oil and guarantee the conservation of critical biodiversity and uphold citizens’ livelihood rights.”

If the planned withdrawal is successful, it will show that the government does not commit to following its laws and institutions on revenue management and communities that require oil revenues to be used only for development purpose as opposed to consumption.

“The violation will show a bad precedent on Uganda’s ongoing effort to join the Extractive Industries Transparency Initiative (EITI) whose principles are committed to upholding transparency in the collection and use of revenues.”

“We are also calling on Parliament to use her oversight powers over the executive and direct the Minister of Finance to once and for and respect national laws and uphold transparency in the management and utilization of oil revenues.”


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