October 2019 ACCOUNTABILITY SECTOR ANNUAL REPORT FOR FY 2018/19 October 2019 October 2019 iii ACCOUNTABILITY SECTOR ANNUAL REPORT FOR FY 2018/19 October 2019 Foreword The Accountability Sector is concerned with the mobilization, management and fostering accountability for the utilisation of public resources to facilitate the delivery of quality and equitable services. This report provides an overview of the Accountability Sector, and details of its achievements as well as challenges experienced in delivering the results for FY 2018/19. The report also provides an overview of the Development Partner funded programmes and projects that supported and contributed to the Accountability Sector’s achievements for FY 2018/19. Accountability is a shared responsibility. In your position as a citizen, beneficiary of public services, policy maker or implementer, religious leader, civil society, private sector player, development partner etc, you have a role to play in ensuring the delivery of quality and equitable public services. This role may include your participation in the government planning and budgeting cycle and getting to know and contribute to the plans and budgets of your Local and Central Governments. This could also mean monitoring the implementation of the approved Local and Central Government plans, budgets, policies, programs and projects; reporting any irregularities and deviations from plan and budget; participating and contributing to the review and evaluation of government policies, programs and projects, etc. This report is part of the accountability for the resources availed to the Accountability Sector during FY 2018/19, and is intended to create awareness about the Accountability Sector as well as facilitate you to demand for Accountability. It is therefore my wish that you take time to read and internalise the contents of this report so that you can fully understand the Accountability Sector and its achievements and challenges. In case the details provided in this report are not sufficient, I encourage you to get in touch with the Secretariat, so they can provide the necessary details or link you to the responsible Accountability Sector Institution to give you the necessary information. I take this opportunity to appreciate all the support accorded to the Accountability Sector by our Development Partners, particularly the following; USAID, UK/DFID, EU, KfW, Norway, Denmark, GIZ, IMF and the World Bank. I also thank the members of the Accountability Sector Leadership and Steering Committee, Sector Institutions, Sector Working Group, Technical Working Groups and the Secretariat for the cooperation, dedicated effort and hard work for the achievements we have registered in FY 2018/19. I specifically thank the Secretariat team for putting together this report. Matia Kasaija (MP) Minister of Finance, Planning and Economic Development/ Chairperson, Accountability Sector Leadership Committee iii ACCOUNTABILITY SECTOR ANNUAL REPORT FOR FY 2018/19 October 2019 Contents Foreword ................................................................................................................................................... iii List of Acronyms ........................................................................................................................................vi Executive Summary ...................................................................................................................................ix 1.0 Introduction and Background ........................................................................................ 1 1.1 Overview of the Accountability Sector ............................................................................ 1 1.1.1 Accountability Sector Outcomes and Objectives ......................................................... 2 1.1.2 Accountability Sector Institutions and their mandates .............................................. 3 1.1.3 Management of the Accountability Sector ................................................................. 10 2.0 Sector Performance and Challenges ............................................................................ 12 2.1 Sector Budget Performance ......................................................................................... 12 2.2 Economic Management ............................................................................................... 13 2.2.1 Economic Growth ........................................................................................................ 13 2.2.2 Inflation ...................................................................................................................... 14 2.2.3 Access to finance and reduction of Interest rates ................................................... 14 2.2.4 Private investment ..................................................................................................... 19 2.2.5 Insurance penetration ............................................................................................... 26 2.2.6 National Savings ....................................................................................................... 27 2.2.7 Level of capitalisation and widening of investment opportunities ........................... 29 2.2.8 Statistical Data Production and Policy Research ..................................................... 31 2.2.9 Anti-Money Laundering and Combating the Financing of Terrorism ...................... 31 2.3 Resource Mobilisation and Allocation .......................................................................... 35 2.3.1 National Revenues ..................................................................................................... 35 2.3.2 Local Revenues .......................................................................................................... 41 2.3.3 Public Debt ................................................................................................................ 44 2.3.4 Budget Credibility ...................................................................................................... 45 2.3.5 Public Investment Management ............................................................................... 46 2.4 Budget Execution and Accountability ........................................................................... 50 2.4.1 Compliance with accountability rules and regulations ............................................. 50 2.4.2 Public Contract Management and Performance ...................................................... 56 2.4.3 Public demand for accountability .............................................................................. 61 2.5 Audit and Anticorruption .............................................................................................. 65 2.5.1 Prevention, detection and elimination of corruption ................................................ 66 2.5.2 Collaboration and networking among development institutions ............................. 74 2.6 Performance against other Benchmarks ..................................................................... 74 2.6.1 Compliance of the Annual Budget with the NDP ...................................................... 75 2.6.2 Gender and equity compliance .................................................................................. 76 2.6.3 Compliance with reporting requirements ................................................................. 76 2.6.4 Government Annual Performance Report (GAPR) .................................................... 77 2.6.5 Overall performance .................................................................................................. 78 3.0 Development Partners’ Support to the Accountability Sector ...................................... 79 Annex 1: Information on programs and projects funded by Development Partners ......... 84 Annex 2: Accountability Sector Common Results Matrix ................................................. 100 Annex 3: Status of implementation of ASJAR 2018 undertakings .................................. 108 iv v ACCOUNTABILITY SECTOR ANNUAL REPORT FOR FY 2018/19 October 2019 List of Tables Table 1: Accountability Sector thematic areas and coverage .............................................. 1 Table 2: Accountability Sector Budget Performance FY 2018/19 ...................................... 12 Table 3: Trends in Capitalization of UDB (Ush’000), as at June 2019 ................................ 16 Table 4: Loan Disbursements in 2018/19 ........................................................................... 17 Table 5: Summary table of Performance Indicators for FY 2018/19 .................................. 33 Table 6: Summary of revenue performance FY 2018/19 .................................................... 35 Table 7: Performance of policy measures FY 2018/19 ....................................................... 36 Table 8: Resource Mobilisation and Allocation thematic area performance summary .... 47 Table 9: Status on submission of Annual Accounts FY 2018/19 ......................................... 51 Table 10: Budget Execution and Accountability thematic area performance summary ... 64 Table 11: Nature and incidence of cases reported to IG in Local Governments ................ 71 Table 12: Nature of cases resolved by the ombudsman in Local Governments ................ 72 Table 13: Audit and Anti-corruption thematic area performance summary ..................... 73 Table 14: Institutional scores in respect