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close this bookUganda's Water Sector Development: Towards Sustainable Systems (SKAT, 1996)
close this folder3. Driving Forces
View the document(introduction...)
View the documentThe physical environment
View the documentState of existing infrastructure
View the documentPressing financial shortages
View the documentNeed for legislative reforms
View the documentInstitutional requirements

Pressing financial shortages

The NRM Government inherited a financial nightmare. Virtually none of the country's administrative functions were self-supporting. Few Government departments had the funds to cover their operating requirements. Many could not afford to pay their staff.

In the water sector, revenues covered less than one per cent of the inadequate budget. The inability of the Government to provide subsidy hampered operations, yet the Government's administrative controls dissuaded the MWMD from raising its charges. Inefficient use of the limited capital that was available perpetuated the downward spiral.

The Government's meagre finances could not support the major investments required to rehabilitate and extend the rural water supply systems but it faced a dilemma. It needed external funds to rebuild the rural water supply sector. In particular, it needed donor agency funds. However, donors were wary of Uganda — most would only support the restoration efforts on a contingent basis. The Government needed to demonstrate that it was capable of dealing with the funds in a responsible and productive manner. As a matter of urgency, it had to improve its legislative framework by enshrining proper safeguards in the law. It also needed to rebuild its public institutions so that they could disburse funds in an effective and efficient way. The issue of Government as provider and owner of facilities with minimal or no 'user participation' also required re-thinking and new strategies.