By Lutaaya Brian Wamala, Business Entrepreneurship and Public Policy academic, brianer1@outlook

Low and Low-middle Income HousesSince the NRM’s ascension to power in 1986, numerous efforts have been made to eradicate poverty across Uganda. In 1997, the government took a more direct approach to poverty eradication through its Poverty Eradication Action Plan (PEAP).  Two and a half decades later, it has since conceptualized and implemented up to a dozen multi-sectoral poverty eradication programs targeting various special interest groups from women to youth.

Despite these efforts, Uganda’s economy is still limping. Poverty remains visibly prevalent. This is reflected in the World Bank’s poverty rankings, which show that  41% of  Uganda’s population lives on less than $1.90 a day. According to the United Nations Development Program (UNDP), this situation was further exacerbated by the COVID-19 pandemic, which pushed an additional 1.9 million Ugandans into poverty.

This predicament makes the government’s efforts to transform Uganda’s predominantly subsistence economy into a middle-income economy by facilitating the creation of wealth-generating activities at the grass-roots level even more necessary. However, instituting similar programs this time without first understanding why previous efforts failed is likely to fail again. To that effect, the government must address key issues to make its poverty intervention programs successful.  

The most critical issues that should be looked at are mismanagement and accountability. Though it may be hard for some people to believe it, every one of the mentioned programs has been mismanaged by those tasked with their implementation. Billions, if not trillions of shillings, have been lost in numerous ways. For example, Emyooga, a presidential initiative, was designed to direct low-interest financing to income-generating activities undertaken by selected  Savings and Credit Cooperative Organisations (SACCOs). Yet, a parliamentary committee investigating the program's implementation documented how funds were instead diverted to political groups loyal to the National Resistance Movement (NRM), the ruling party. Many of these groups have since failed to return the funds as required.

Another example of gross mismanagement is with the Youth Livelihood Program, (YLP) where numerous press reports cited instances of outright fraud by program administrators. In Gulu, for instance, the district cashier withdrew a total of 256 million shillings meant for the program and, instead of distributing it to youth groups, he kept it for his personal use. Similar cases are ubiquitous across the country.

For the government’s efforts to bear fruits, it must decisively deal with corruption and implementation mechanisms that curb mismanagement like the ones mentioned above. In the past, however, the apparent lack of political will to bring those implicated in such cases to book has allowed corruption to go on unabated.  It is no wonder that the culture of corruption has persisted throughout these programs, which have left the taxpayer counting losses.

Second comes the issues of conceptualization and planning. Though many of the past programs might have appeared conceptually good, they failed miserably due to poor planning and implementation.  For example, the YLP program was doomed to fail from the inception. Starting and operating a business requires more than just money. It also requires people with strong managerial skills. So, it was erroneous for the program architects to imagine that giving out money to youths without adequately skilling them in business and financial literacy matters would yield anything other than business failure.

Hon. Richard Othieno of West Budama gave an account of many of his youthful constituents who received the money but did not have any business skills. These individuals failed to use the money to actualize their business plans. Others diverted the money to other activities and are now languishing in jail for failure to pay back the loans.

A better alternative would be for the government to partner with incubation hubs and organizations like  Enterprise Uganda and the Private Sector Foundation to offer business training to prospective beneficiaries of future programs before and after receiving the funds. They should be trained in financial and organizational management. The guidance they receive should continue even beyond the start of their businesses, at least until they break even.

Furthermore, the government should drop the Laisse Faire approach. It should  aggressively rack up its efforts to monitor the beneficiaries' activities to ensure that funds are used for the intended purpose and that loan payments are remitted on time. Therefore, the government should consider narrowing its approach to a sector or regional level. Such an approach is supported by research done by McKinsey & Co, in countries such as Liberia, where they found that similar programs failed because governments found it hard to monitor similar projects which were so widespread across various sectors and over wide geographical areas. In contrast, the same study reported that South Korea’s poverty intervention programs succeeded because the government narrowed its scope to sectors like agriculture and relegated the same to specific regions at a time. This made monitoring projects much more manageable.

With the latest poverty intervention program, the Parish Development Model (PDM) that seeks to spur wealth creation across various sectors right from the parish level now underway, the proposed reforms discussed here could not have come at a better time. The government needs to look back at the shortcomings of its previous attempts at poverty eradication and learn from them. The need to carry out policy reforms accordingly to address the identified challenges is now more profound than ever before if Uganda hopes to achieve its development agenda.  The developmental agenda includes the globally adopted Sustainable Development Goals (SDGs), whose number one goal is to eliminate global poverty and, ultimately, Vision 2040, which seeks to transform Uganda from a poor peasant subsistence economy into a highly prosperous middle income economy by 2040.