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The New Poverty Agenda in Uganda Anne Mette Kjaer and Fred Muhumuza

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The New Poverty Agenda in Uganda Anne Mette Kjaer and Fred Muhumuza DIIS WORKINGDIIS WORKING PAPER 2009:1PAPER4 The New Poverty Agenda in Uganda Anne Mette Kjaer and Fred Muhumuza DIIS Working Paper 2009:14 WORKING PAPER WORKING 1 DIIS WORKING PAPER 2009:14 ANNE METTE KJAER Associate Professor Department of Political Science, University of Århus, Denmark [email protected] FRED MUHUMUZA Lecturer Department of Economics and Management, Makerere University, Uganda [email protected] The interviews for this paper were carried out by Anne Mette Kjær, Tom Mwebaze, Patrick Birungi and Fred Muhumuza. DIIS Working Papers make available DIIS researchers’ and DIIS project partners’ work in progress towards proper publishing. They may include important documentation which is not necessarily published elsewhere. DIIS Working Papers are published under the responsibility of the author alone. DIIS Working Papers should not be quoted without the express permission of the author. DIIS WORKING PAPER 2009:14 © Copenhagen 2009 Danish Institute for International Studies, DIIS Strandgade 56, DK-1401 Copenhagen, Denmark Ph: +45 32 69 87 87 Fax: +45 32 69 87 00 E-mail: [email protected] Web: www.diis.dk Cover Design: Carsten Schiøler Layout: Allan Lind Jørgensen Printed in Denmark by Vesterkopi AS ISBN: 978-87-7605-338-3 Price: DKK 25.00 (VAT included) DIIS publications can be downloaded free of charge from www.diis.dk 2 DIIS WORKING PAPER 2009:14 DIIS WORKING PAPER SUB-SERIES ON ELITES, PRODUCTION AND POVERTY This working paper sub-series includes papers generated in relation to the research pro- gramme ‘Elites, Production and Poverty’. This collaborative research programme, launched in 2008, brings together research institutions and universities in Bangladesh, Denmark, Ghana, Mozambique, Tanzania and Uganda and is funded by the Danish Consultative Research Committee for Development Research. The Elites programme is coordinated by the Danish Institute for International Studies, Copenhagen, and runs until the end of 2011. More infor- mation about the research and access to publications can be found on the website HYPER- LINK “http://www.diis.dk/EPP”www.diis.dk/EPP. Earlier papers in this subseries: Rweyemamu, Dennis: “Strategies for Growth and Poverty Reduction: Has Tanzania’s Second PRSP Influenced implementation?” DIIS Working Paper 2009:13. 3 DIIS WORKING PAPER 2009:14 CONTENTS Abstract 5 1. Early strategies and debates around poverty 7 Poverty reduction through economic transformation 7 From pro-interventionist to pro-market governance 8 2. Emergence of a policy consensus around poverty reduction and the poverty eradication action plan. 10 3. PEAP implementation 14 4. Recent developments: The waning consensus on poverty reduction and the increasingly pronounced, parallel political agenda 21 References 26 4 DIIS WORKING PAPER 2009:14 ABSTRACT This paper explores the poverty agenda in Uganda, its drivers and its effects. We show that transforming the economy by increasing productivity was initially considered more important than to reduce poverty through redistributive poli- cies. However, as a consequence of the 1996 elections a consensus on poverty eradication through health and education emerged. The Poverty Eradication Action Plan (PEAP) had a shopping list nature and it is therefore difficult to es- tablish whether it was implemented. Growth and poverty reduction during the PEAP period was mainly due to a continuation of macro-economic policies that were introduced prior to the PEAP. Around the multi-party elections in 2006, policy priorities changed towards more focus on agricultural production, agro-business and infrastructure. The government now has a two-edged focus: poverty reduction through economic transformation and poverty reduction through social services. However, there is also a political agenda about remain- ing in power which threatens to undermine the results achieved so far. 5 DIIS WORKING PAPER 2009:14 6 DIIS WORKING PAPER 2009:14 1. EARLY STRATEGIES AND There is no way that Africans can emancipate DEBATES AROUND POVERTY themselves from poverty and backwardness without carrying out an industrial revolution. As long as we continue exporting cheap, raw, primary commodities, Uganda’s long period of economic growth our present situation will not change (Museveni, began in the early 1990s, just a few years 1992: 208). after the National Resistance Army and its Our economic programme hinges on reviving and leader, Yoweri Museveni, took office (in diversifying production, both in the agricultural and 1986) after a prolonged civil war. Speeches industrial sectors, with a view to creating a well-in- and policy documents from the late 1980s tegrated, self-sustaining economy … this particularly and early 1990s show at least three things: involves restoring traditional export crops, and also (i) that poverty reduction through social expanding non-traditional crops such as beans or sim- transfers was not an initial concern of the sim (Museveni, 1992: 45). government, (ii) that the government over Thus, poverty reduction would only hap- its first few years in power gradually shifted pen through more production, employment from a pro-interventionist policy stance to a and income-generation. During the early pro-market view more in line with the IMF’s 1990s, there was some mention of social pro- position; and (iii) that structural adjustment grams but it remained a secondary concern. policies carried out did not have negative ef- For example, in 1989/90, the Programme on fects on poverty levels. Poverty and Alleviation of the Social Costs of Adjustment (PAPSCA) was introduced, in collaboration with the World Bank, to amelio- Poverty reduction through economic rate the effects of structural adjustment. This transformation early programme, however, can be argued to In the first few years of the NRM rule be more of a consequence of the internation- (about 1986-1992) the policy debates were al debate on the costs of adjustment to pov- dominated by restoring security and eco- erty reduction following the publication of nomic reconstruction and stabilization. In the 1987 UNICEF report “Adjustment with a the publication of 29 of President Musev- Human Face”, which focused on the negative eni’s main speeches during the 1989-1992 implications of structural adjustment (Cornia period, the words poverty, poverty reduc- et al, 1988). The generally accepted policy im- tion or the poor are hardly mentioned plications of the report’s recommendations (Museveni, 1992). Similarly, poverty was not were to protect public expenditure on the so- brought up in early budget speeches (1989, cial sectors, such as health and education, and 1990). Rather, and reflecting the ten-point this was adopted and sustained in Uganda’s programme of the movement, the speeches later policy frameworks under the PEAP. The in general have a strong focus on economic predominant view on poverty, however, was transformation through industrialization still not one that favoured a specific targeting and increased value addition in production. of the poor but rather one that emphasized The assumption was that the best way to al- increased production and trade in exports. leviate poverty would be through income For example, Museveni, in his autobiography generation, as reflected in the following two focuses squarely on roads and infrastructure quotes: as having a crucial role in eliminating rural 7 DIIS WORKING PAPER 2009:14 poverty and laments the fact that focus has measures to socialize risks where investments been more on various “poverty relief pro- do not easily occur by themselves in the pri- grammes” such as the PAPSCA and that the vate sector (Weiss and Hobson, 1995). In the money was “scattered in inappropriate direc- president’s early speeches, there was a vision tions” (Museveni, 1997). of a rather interventionist state, as priorities “My view is that these ministries are wasting re- were on not only infrastructure, but also gov- sources” and “roads must be prior to actual relief”. ernment provision of agricultural machinery “Before we talk of poverty alleviation and other such and implements, seeds, herbicides, on provid- things, we should talk about the movement of goods ing trucks for transportation of produce and and services. If people are able to sell their goods and consumer goods, and on the provision of in- services, they will be able not only to alleviate their dustrial raw materials and spare parts to fac- own poverty, but to eliminate it completely through tories. This comes out very clearly at the OAU their own efforts” (ibid: p. 183). summit in 1990, where the President directly In other words, according to this view, the says that “deliberate government intervention is poor need not be directly targeted but rather needed to ensure overall sectoral and enterprise plan- facilitated through improvement of infra- ning. It is an error if we simply leave the emergence structure for increased production (see also of new industries to so-called market forces. There Mugaju; 1996: 38). Budget allocations in this is a need for proper planning” (Museveni, 1992: period largely reflected these priorities in that 238). In addition, Museveni emphasizes the infrastructure received large allocations. Al- importance of buying Ugandan produce, for locations for the agricultural sector remained example, at an address in 1989, he intends to below 4% of the budget during the 1990s “do everything possible to pressurize the Government (Mugaju, 1996: 40, UNDP, 2007). This was of Uganda to ensure that we buy what we produce in probably mainly due to the general liberaliza- Uganda” (ibid: 214). tion of the sector over the period. Allocations Over the years, the vision of a more in- for the social sectors grew in the period but terventionist state came under scrutiny both from a very low start – thus, contrary to oth- because the early measures could not be sus- er African countries going through structural tained, and also because of the emergence adjustment, Uganda was able to increase gov- of a cadre of technocrats, both Ugandan ernment expenditures during the early 1990s and foreigners who increasingly challenged in line with the restoration of peace and or- the interventionist view.
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