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Experts call for balanced investment in infrastructure

FILE PHOTO: Establishment of Entebbe express highway.

Kampala, Uganda | THE INDEPENDENT | Economics’ Analysts have said it’s time for the government to start increasing budget allocated to the social sectors which have for years been dwarfed by works, transport and energy sector investments.

Both experts from government, research institutions and international agencies spoke in unison during a discussion on social sector financing organised by Makerere University Economic Research Centre and United Nations International Children’s Emergency Fund (UNICEF) Uganda at Hotel Africana on Tuesday afternoon.

The debate was informed by the projected allocations for the 2019/20 financial year budget. Investment in the social sector was scaled down in the past years as government focused on financing gigantic infrastructure projects. Works and services sectors continues to take lion’s share in the budgeting process.

The works and transport sector, for instance has been allocated 20.8 percent of the budget, while the energy sector has been allocated 10.4 percent. The key social sector areas such as education has been allocated 10.5 percent and health 8.9 percent.

Investment in social sectors has sharply reduced for the past decades, according to statistics presented by Economic Policy Research Centre. For instance, education sector allocation nosedived from 16 percent to 10.4 percent since 2010. The story has been the same in other sectors, apart from the Justice, Law and Order Sector (JLOS).

The debate on investment in social sector visa vie infrastructure has been ongoing. Exponents of increased investment in infrastructure argue that this will buttress industrialization and in-turn create jobs. But proponents of increased investment in social sector have argued that industrialization is meaningless without an educated, healthy and productive populace.

The Director of Development Planning at National Planning Authority (NPA), Dr Patrick Birungi said in the third National Development Plan (NDP III) which is already being drafted, government will try to balance investment in social sectors and infrastructure will be balanced.

UNICEF’s Deputy Representative to Uganda, Noreen Prendeville said social indicators are showing mixed progress. Literacy and numeracy, she said improved until 2010 but stagnated since. And primary education completion rates have declined.

“Improvements in child and maternal mortality rates are visibly slowing down, and the proportion of Ugandan households living in poverty increased from 19.7% to 21.4% of the population between 2012/13 and 2016/17,” she said.

Uganda has entered the demographic transition with an estimated 600,000-700,000 individuals entering the labour market each year, according to World Bank. Noreen argued that workers require good-quality education to gain competency for high wage jobs and become competitive in regional and global markets.

Uganda registered 6.1 GDP growth last financial year. This growth is projected to increase to 6.3 percent in the ongoing financial year, according to World Bank projections. For growth to be inclusive, Noreen said government should increase budgetary allocations to social sectors.

Dr. Ibrahim Kasirye, a senior research fellow at Economic Policy Research Centre argued that industries which government is attracting through infrastructure investment requires  right personnel who can only come from well-funded social sectors.

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