Underfunding still hampers social protection programs

Investing in disability-inclusive social protection programs is essential to address the various risks, poverty, inequalities and exclusion that are often associated with disability.

In order to preserve the situation, in recent years the government has introduced targeted social protection programs.

However, a Development Initiative report found that social development was among the least funded sectors, reflecting the lower priority given to social protection.

Underfunding of social development has directly contributed to funding gaps that have affected the implementation of social protection programs over the years. Allocations to social development as a share of the national budget have continued to decline despite the steady increase in the national budget.

The report indicates that the allocation to the social development budget as a share of the national budget decreased from 0.7% in the 2016/17 financial year to 0.4% in the 2020/21 financial year.

“The volume of funding allocated to the implementation of social sector programs fluctuated over the five-year period between FY 2016/17 and FY 2020/21. The social protection budget allocated to local governments implementing the decentralized functions of the Ministry of Gender, Labor and Social Development represented on average 3% of the total social protection allocation. This is quite small compared to the share allocated to national/central government,” the report states.

Moses Obbo Owori, Principal Analyst at Development Initiatives, says: “This means that only a very small proportion of those who are meant to benefit are reached, leaving a large majority of Uganda’s population living in poverty and vulnerability unattended.

With Covid-19, limited government funding and coverage under existing social protection programs is likely to be further hampered. Shocks affecting the capacity to mobilize domestic revenue can only further limit the government’s ability to finance social protection.

The report indicates that many social programs in Uganda are poorly funded, which is often exacerbated by the central government’s inability to disburse approved budget funds to different institutions, creating gaps that affect the implementation of social protection programs. .

Gap in the Social Assistance Grant for Empowerment (SAGE) budget: Uganda is implementing the SAGE program aimed at enabling older people to access basic services and start income generating activities for their livelihood.

According to the Ministry of Gender, Labor and Social Development, for the financial year 2022/23, the total budget required to fund the SAGE program is Shs 182.775 billion, but only Shs 120.7 billion is expected to be available, leaving a financing gap of Shs. 63.75 billion. . This will significantly affect beneficiary verification, registration, enrollment and payments, resulting in an accumulation of beneficiary payment arrears. In addition, arrears of 270,203 beneficiaries were not paid in FY 2020/21 due to insufficient resources and were not budgeted by MoFPED as committed in FY 2022/23 .

“Therefore, the government should streamline budget allocation within the ministry and allocate resources to fill the funding gap of Shs63.5b, with priority given to payment of arrears to SAGE beneficiaries, said Julius Mukunda, Director Executive of the Civil Society Budget Advocacy Group.

Development Initiative notes that most social protection schemes under the social development agenda are inadequate and do not reach many of the poorest and most vulnerable people in the country. The approved budget for the 2020/21 financial year did not include any allocation for local government social protection activities.

Budget allocation trend (approved budget for last five years, FY2016/17 to FY2020/21) calculated figures indicate that in 2016/17 national budget Shs 194.476 million, local government 7.640 million, 2017/18 national 177,806 local government Shs7.640 million, 2018/19, 218,215, local government 7.640 million, 2019/20, local government Shs7,640 221,349, national budget 2020/21 Shs 187,406 local government was nil.

The allocation of funds to the social protection program for vulnerable groups represents the largest share of the social development sector budget. This share fluctuated from 51% (in the financial year 2016/17) to 35% (in the financial year 2019/20) to 42% (in the financial year 2020/21). The fluctuation in the allocation of funds to social protection programs appears to be caused by reduced or zero allocations to certain social protection activities in certain fiscal years

Budget share of the protection of vulnerable groups,

Allocation of social protection to vulnerable groups FY 2016/17-FY 2020/21

The main social protection programs run by the MGLSD include cash transfers to vulnerable groups, pensions for the elderly, and grants for youth, women, and people with disabilities. The SAGE program for various vulnerable groups is centrally coordinated and managed by the Social Protection Expansion Program Unit28 of the MGLSD.

Other social protection programs originally run by the MGLSD include the Youth Livelihood Program (YLP) and the Uganda Women’s Entrepreneurship Program.

In 2018, the Ugandan government decided that from the financial year 2019/20, the subsidy for the elderly would be extended to all 135 districts in the country from the 61 districts covered so far.

The Development Initiatives Report which was funded with UK Aid from the UK Government and was developed with support from the Inclusive Futures Consortium. It reveals that currently Ugandan districts are covered by the program with 379,801 beneficiaries (218,205 women and 161,596 men) receiving a monthly cash transfer of Shs 25,000.

An evaluation of the implementation of this grant by the National Council for the Disabled reveals that the grant was marred by several challenges, including corruption, misuse by beneficiaries and the lack of a monitoring system. clear, over-reliance on subsidies, limited accessibility and complex requirements to access the subsidy, among others.

Uganda’s institutional frameworks for social protection present various challenges and gaps.

There is poor coordination between institutions, leading to duplication of roles.

“There is also evidence of confusion between MGLSD and local governments over which activities should be implemented. There is also evidence of the lack of clear demarcation of social protection roles between central government ministries, departments and agencies when it comes to implementing social protection programmes,” the report reveals.

Adding, “For example, it is common to find the community mobilization function dispersed across various ministries, departments and agencies, leading to duplication of effort and potential waste of resources.”

There are only two options to fill the current financing gaps in social protection. First, the government can increase the funding allocation to the sector from domestic funding using tax revenue.

Owori said the government should prioritize increasing social welfare allocations from oil revenues and other taxes once the economy fully recovers and oil production begins. This is achievable in the medium and long term.

But the second option is also problematic given the possibility of a continued decline in donor funding over the medium to long term. Many donor countries are already looking inward given the negative economic impact of the pandemic and now the war in Ukraine.

On the policy front, the report stresses that social protection legal and policy frameworks must focus on all vulnerable groups of people, including people with disabilities and children, not just older people.

Develop social protection policies sensitive to the informal sector or amend existing policies to cover it. There should be a policy for assessing and determining vulnerable populations, especially for people with disabilities.

“This will allow the government to plan for additional costs to be included for any assistance grants such as cash assistance, concessions or in-kind support,” the report recommends.

The report finds that gaps in the implementation of key social protection programs could point to gaps in monitoring, supervision and coordination between institutions.

In their joint analysis, the International Growth Center (IGC) and the Economic Policy Research Center (EPRC) said on May 25 at the Ministry of Finance and Bank of Uganda Policy Workshop ( BoU) on high commodity prices, that providing cash transfers to poor households may be the most effective way to alleviate price pressures. Mobile money provides a cheap delivery method for the government.

During the presentation of the document, the Director of Research at the Economic Policy Center (EPRC), Dr Ibrahim Kasirye, said that the administration of cash transfer programs must ensure that the poorest households receive the transfers – targeting and administration.

“Poor households have suffered the greatest reduction in consumption and have the least capacity to absorb price increases. Focus on reforms that are already on the government’s agenda, avoid introducing distortions,” said IGC/EPRC.

Joel C. Hicks