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Auditor General Highlights Flaws in PDM Program

Auditor General John Muwanga has highlighted several challenges of the Parish Development Model (PDM).  They range from incomplete baseline data, implementing entities not provided with resources to undertake the start-up activities, and diversion of 17.5 billion, 594.7 million Shillings in five Local Governments among others.

The findings are in his latest audit report on finances released in the last financial year 2021. Muwanga presented the report to Speaker of Parliament, Anita Among on Thursday.

The government launched the Parish Development Model (PDM) during the year under review as a delivery mechanism for transitioning 39 percent of households from a subsistence economy to a money economy and as a wealth creation programme at the lowest economic planning unit, the parish.

The model is premised on seven pillars including Agriculture Value Chain Development, Infrastructure and Economic Services, Financial Inclusion, Social Services, Community Mobilization and Mind-set Change, Parish-Based Management Information System and Governance and Administration.

In his report, Muwanga says that the revised budget for the Model during the financial year was 234 billion Shillings out of which, 139 billion was released representing 59.4 percent performance.

“I reviewed the government’s preparedness to implement this intervention and noted the following; Successful implementation of the PDM requires complete and reliable baseline data. The data collection exercise was supposed to be undertaken by the Uganda Bureau of Statistics, the Ministry of Information, Communication and Technology and the Local Governments between 6th June 2022 and 31st July 2022. By the time of writing this report in December 2022, only 41 percent of the expected data had been collected,” says Muwanga.

The Auditor General says that the data should have informed the selection of beneficiaries, and would be used for future performance reviews and impact assessments. Muwanga also queries that five implementing entities including the Ministries of Agriculture, Health, Water, Education and Works were not provided with resources for undertaking start-up activities. The money was meant for activities like the selection of enterprises for each parish, formation of parish-based commodity clusters, identification and prioritization of social services at the sub-county and district level, and development of a strategy for upgrading local markets.

“As a result, these activities were only partially done using resources provided within the approved budgets of these entities which were inadequate. This affected preparedness to fully roll out the PDM intervention” reads the report.

Regarding disbursed funds, Auditor General says that the money was meant to fund administrative activities, recruit parish chiefs, purchase gadgets and tools and fund SACCOs without accompanying with guidance on funds utilization.

“I note that the guidelines or directives were later issued towards the end of the financial year after funds had been released. In addition, the guidance was at times contradictory,” he notes.

Muwanga reports that 17.5 billion Shillings was diverted from the purchase of gadgets and tools, staff costs and administrative costs to revolving funds in 146 Local Governments without authorization, contrary to Regulation 16(1) of the Public Finance Management Regulations (PFMR) 2016. He reveals that funds disbursed to SACCOs varied from one District Local Government to another with SACCOs receiving amounts ranging from 2.3 million to 17.8 million.

Muwanga also reports that 1,502 SACCOs in 70 Local Governments did not receive any funding. 

“The funding variations were attributed to a lack of accurate data on the number of parishes and shortfalls in releases. 29.5 billion meant for revolving funds in 49 Local Governments was transferred to 3,214 SACCOs that were neither registered under the Cooperative Societies Act nor had signed Parish Revolving Fund (PRF) Financing Agreements,” further reads the audit report.

79.2 billion Shillings was disbursed by the Ministry of Finance to the District accounts instead of the beneficiary SACCOs accounts, contrary to Guidelines of the PDM issued in May 2022 and consequently, five Districts diverted 358 million from the revolving fund to administrative activities.

Another 79.2 billion Shillings paid to 8,703 SACCOs as revolving funds in 169 Local Governments remained idle on SACCO bank accounts ad Auditor General Muwanga says that failure to utilize the funds delays the achievement of PDM objective of improving community livelihoods.

“I noted irregularities in the recruitment of parish chiefs. For instance, in Butaleja District Local Government, 15 out of the 39 parish chiefs recruited had forged academic documents, resulting in the loss of government funds worth 12 million Shillings. PDM funds amounting to 594.7 million in five Local Governments relating to administrative costs, staff costs and gadgets and tools were not adequately supported with the requisite documentation,” says the Auditor General.

Edward Akol, the Assistant Auditor General presented the figures to Speaker Among.

The Auditor General recommended that government fast-track the collection of baseline data, and the development of the Parish Budget and Management Information System (PBMIS) for which PDM was designed for implementation.

Muwanga also wants the Ministry of Finance to streamline the processes of budgeting, release, utilization and accountability for all PDM funds and coordinate with the PDM Secretariat to harmonize the programme implementation guidelines. 

He recommended that the Ministry of Local Government and the Ministry of Finance should ensure all disbursed PDM funds are fully accounted for and that accounting officers should revoke appointment letters of the irregularly appointed parish chiefs and recover the paid funds. 

The Auditor General, however, noted that the government has registered some achievements in regard to the PDM implementation and these include constituting a National Policy Committee to give strategic direction for the programme, setting up a functional PDM Secretariat, publicizing the programme nationwide and issuing of implementation guidelines. 

Speaker Among urged the Auditor General to be more strict on Parish Development Model funds to ensure that the right people benefit from the programme.

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