KAMPALA
Persistent losses in several government-owned companies are raising concerns over the growing financial burden placed on taxpayers, the executive director of the Civil Society Budget Advocacy Group (CSBAG), Julius Mukunda, has said.
Mukunda said many state enterprises continue to rely heavily on government funding despite recording significant financial losses, a trend highlighted in the latest report by the Office of the Auditor General.
According to the AG report, State Enterprises such as Uganda Broadcasting Corporation (UBC), reportedly accumulated losses exceeding Shs444b, and the national carrier Uganda Airlines, which has also faced Shs230b operational and financial challenges.
“These state enterprises depend on government subvention to continue operating,” Mukunda said.
He made the remarks while addressing journalists in Ntinda, Kampala on Sunday.
Subventions are funds provided by government from the Consolidated Fund to support operations of public entities.
Mukunda explained that when these enterprises incur losses or fail to service loans, government is forced to step in and settle the liabilities.
“When a state enterprise borrows money and fails to pay, creditors turn to government because the borrowing was done with government backing. In the end, it is taxpayers who carry the burden,” he said.
He also criticised the lack of accountability in the management of state-owned companies, noting that there are often no consequences when losses occur.
“When losses are reported, nothing happens. Even when some enterprises make profits, they do not pay dividends back to government,” Mukunda said.
He warned that continued inefficiency in state enterprises could further constrain Uganda’s fiscal space, forcing government to divert resources from key sectors such as health, infrastructure and education to cover losses.
“Uganda Airlines is an enterprise that is being run very efficiently, So the longer we take to make a decision, the more losses we incur as a government,” he emphasized.
Mukunda called for stronger oversight and clear performance benchmarks for state enterprises to ensure public funds are used efficiently.
