General Budget Support

THE MDG CONTRACT (€ 175 M)
The MDG-Contract (MDG-C) is the EU Delegation's general budget support instrument in
Uganda, which is now in its third year of implementation. The MDG-C is fully aligned with
other partners in the Joint Budget Support Framework (JBSF), which aims at ensuring
economic growth and improving service delivery. Disbursements of funds to Uganda depend
on macro-economic stability, progress towards the implementation of the National
Development Policy NDP), and sufficient progress in the area of public financial management
– including increased transparency and accountability – as well as progress in key health and
education indicators.

Preliminary results from the 2009/10 Uganda National Household Survey (UNHS) confirm that
poverty levels have continued to drop. However, data also confirm that especially the quality of
basic service delivery remains low which adversely affects the likeliness of attaining all MDG
targets. After a rapid increase in the coverage and range of social services delivered in the
early 2000s, performance and quality have stagnated more recently.

There are a number of reasons for this stagnation. A key challenge to development and the
MDGs in Uganda is the massive population growth rate, which puts enormous pressure on
service sectors and the economy overall. Another challenge is the wasteful spending of public
resources. Monies have been mismanaged in grand corruption cases such as the
Commonwealth heads of Government Meeting CHOGM, Global Fund, GAVI, and NSSF but
also on a day-to-day basis as for example in the case of NAADS and drug supplies to public
health facilities. The Government has embarked on an ambitious reform program to improve
the management of public finances. However, systematic and serious follow up on grand
corruption cases is still a weakness. The European Union supports the Government in
implementing these reforms and the effective follow up on corruption cases to achieve better
and more services for Ugandan citizens.

In 2010, the European Commission has launched a review process of its budget support
modality. A so-called "Green Paper" was published inviting Governments, Development
Partners, Civil Society Organisations, and individuals to comment on a number of key
questions. The EU Delegation in Uganda has organised consultation meetings with all
stakeholders to raise awareness for this review process and obtain the Ugandan view.

SUPPORT TO THE GOU ECONOMIC REFORMS ( € 4 M)
The main objective of this programme is to contribute to the overall aim of the Joint Budget
Support Framework (JBSF) as agreed upon between GoU and Donor Partners (DP) i.e to
improve the impact of public spending on the lives of poor people, while maintaining
macroeconomic stability and supporting economic growth. Two components:

FINMAP Component:
Support the implementation of GoU's national Public Finance Management Reform programme, FINMAP, which will constitute the main vehicle for the implementation of the cross-cutting policy actions agreed in the Joint Assessment Framework (JAF).

 

MDG-C monitoring Component:

Support policies and actions to improve data production, analysis and evaluation for the
monitoring of the JAF, policy dialogue and evidence-based decision making by both the GoU
and JBSF DPs. This component developed into supporting to TASU, the Technical and
Administrative Support Unit of the JBSF (Joint Budget Support Framework).