MPs’ Shs 103m cars bad for economy

By Peter Nyanzi

What moral authority will this Parliament have to demand that other departments handle public funds thriftily?

Twenty six years ago when President Yoweri Museveni’s National Resistance Movement government captured power, they won acclaim for condemning the profligacy of the previous regimes, which had made those in power totally out of touch with the poor.

As a young boy then, I remember President Museveni publicly wondering why a minister would need a sleek black Mercedes Benz when a far cheaper Nissan Laurel would do the job equally well, if not better. Only months later, all Museveni’s ministers were being driven around in black Laurel saloon cars. Dozens of Mercedes Benzes that were ordered by Milton Obote’s government were forthwith withdrawn and parked at Nile Hotel to be hired out for weddings.  Many other similar efforts were taken to tame the extravagance and profligacy in public resources management, which immediately led to the popularity of the NRM government. But, that was in 1986.

Barely a week after celebrating the NRM’s 26th Anniversary recently, Ugandans woke up to the news that each of Uganda’s 388 MPs including ministers, were to get Shs103 million each to buy luxury vehicles.

Why, people are now asking, at a time when the country is facing all these economic challenges, would the government sanction such an outrageous expenditure?  What happened to the NRM of the 1980s which was more considerate and more responsive to the needs of ordinary Ugandans?

Recent press reports indicated that the government is so “cash-strapped” that it has been forced to slash the budgets of key ministries and other departmental budgets so as to raise cash to pay off arrears owed to private power generators.

Since last year, civil servants particularly teachers, lecturers, doctors and nurses have been shouting their voices hoarse for better pay and threatening to put down their tools in protest.

With myriad pressing necessities, one must wonder, therefore, if the government is getting its priorities right by spending more than Shs 37 billion on luxury cars for a select group of people who already earn in excess of Shs 15 million each per month.

For several reasons, I think this expenditure on luxury cars is not only bad PR for the government and detrimental to the economy but also portends serious unintended consequences.

Firstly, it is a slap in the face of the Central Bank, which has been taking seemingly unpopular measures to control inflation by “mopping” up the so-called “excess liquidity” in circulation. The Shs 37 billion being released into circulation will surely reverse the gains that have seen the exchange rate stabilise and the inflation rate decline in the last three months. This is because car dealers will have to buy off scarce dollars on the market, a move that will definitely send the local currency plummeting. Also,   many of the MPs particularly those who were re-elected or are cabinet ministers, will actually not buy the cars because they already have them. Either way, it is obvious that the majority of MPs will not spend all their money on cars. The bulk of the money therefore will go into circulation, a development that will completely negate the painful efforts and otherwise good intentions of the Central Bank to stabilise the economy by mitigating inflation and putting the liquidity status under control.

Secondly, in line with the law of unintended consequences, this development is bound to spark more agitation for better pay from the poorly-paid ranks in the civil service, who will only view the government as not being sensitive to their own pleas for better remuneration. Now, the government has been giving “shortage of funds” as an excuse and urging teachers and nurses to be “patient.” So, how come the money to buy hundreds of luxury cars for the MPs could be found?

Thirdly, this expenditure is bad for the public image of the 9th Parliament, which has hitherto been hailed as the vanguard of the fight against the wastage and misuse of public funds. Understandably, there is already an outpouring of both disbelief and disappointment from every quarter and a worry that after all, even the much-hyped ‘champions’ of proper public accountability might not be any different from their predecessors.Of course an MP does need means of transport; nobody is crazy enough to dispute that fact. The issue though, is at what cost to this already over-burdened taxpayer?

While some MPs genuinely need four-wheel drive vehicles – because of the terrain in their constituencies – the majority don’t, so any car costing as little as Shs 50m can take an MP around conveniently in 90% of the constituencies.

In fact, in developed countries like Norway and Netherlands (which ironically give ‘poor’ Uganda millions of dollars in aid every year) Members of Parliament do not cruise around in luxury cars at the taxpayer’s expense. I remember once interacting with a Norwegian MP who told me that she uses public transport to go to Parliament.

Speaker Rebecca Kadaga has defended the luxury cars saying even LC1s were to get bicycles and Gombolola chiefs were to get motorcycles. But while there are bicycles that cost Shs 500,000 each and motorcycles that cost Shs15 million each, the government most probably chose cheaper models. Definitely, taxpayers would be within their rights to complain if Gombolola chiefs were to ride motorcycles priced at Shs 10 million yet there are cheaper models that cost far less than that and do a similar job.

Lastly, the other unintended consequence of Parliament’s extravagance is that it is breeding – actually it has already bred – a luxurious culture among other public officials who manage public resources. It sends a wrong signal to other public officials, who are expected to be more careful in how they use public funds. Now, in playing its watchdog role, what moral authority will this same Parliament have to demand that other departments and institutions handle public funds with more thriftiness?

In summary, I think given the circumstances, the government needs to recapture the ‘patriotic’ and frugal spirit of the 1980s. This probably highlights the urgent need for an independent body to be in charge of setting the remuneration and other benefits of Members of Parliament and other public officials.  But as it is, releasing all the Shs37 billion into circulation could spur the unintended consequences outlined above to the utter detriment of an economy barely able to stand on its feet.

Peter Nyanzi is a journalist

pnyanzi@independent.co.ug