Kagadi District is grappling with growing service delivery setbacks following what local leaders describe as prolonged delays by the Ministry of Finance in remitting Shs521 million in locally collected revenue for the 2024/2025 financial year.
According to district officials, the ministry has not responded to repeated reminders, leaving sub-counties and town councils without critical funds needed to implement key activities. The delays, they say, have disrupted development programs, plunged lower local governments into debt, and strained relations with service providers.
The Town Clerk of Kagadi Town Council, John Isingoma, revealed that more than Shs 120 million expected between January and June of the last financial year remains unreleased.
“We still demand finances from January to June. As of today, we owe our debtors over Shs 150 million,” he said.
“When we were enrolled on the automated revenue system, we were promised a two-week return period. But the remittances are delayed by three weeks or longer. These delays cripple planned activities and leave us in debt.”
Isingoma added that the council’s credibility has been affected, noting that garbage collection has slowed significantly due to lack of fuel, and contractors are threatening to withdraw their services.
Geoffrey Businge, the LC3 Chairperson of Kagadi Town Council in Buyaga East, said the financial gap has hampered essential service delivery.
“We are struggling to execute community mobilisation, maintain cleanliness, and monitor construction projects. All these depend on local revenue,” he said.
“Even council sittings are affected. Councillors trek long distances to attend meetings because there is no transport facilitation. Naturally, attendance has dropped.”
In Kyaterekera Town Council, Buyaga West, LC3 Chairperson Yosam Musisi said the delayed remittances have distorted the entire planning cycle.
“We draft budgets that remain unimplemented due to limited funds. Our plans end up unfulfilled. Services such as street lighting, water access, and maintenance of health facilities have all been affected,” he said.
Kagadi District comprises 35 administrative units — nine town councils and 26 sub-counties — all of which rely on timely remittance of local revenue to sustain operations.
Responding to the concerns, Head of Local Revenue and Principal Financial Analyst at the Local Government Commission, James Ogwanga, said the Ministry of Finance had already disbursed locally collected funds to districts. He advised affected local governments to formally seek clarification from the ministry.
However, Kagadi District Chief Finance Officer (CFO) Vicent Natugonza confirmed that the district is still awaiting the release of the funds, noting that Kagadi Town Council alone is owed more than Shs 100 million.
Natugonza acknowledged that the automated revenue systems IRS and Helobrage have enhanced transparency by eliminating door-to-door collections through the use of Payment Reference Numbers (PRNs). But he explained that the remittance challenges stem from an unexpected increase in local revenue collections.
“The district collected more revenue than its approved budget. Government couldn’t return the money immediately because the budgets for councils were already financed. The excess funds remained on the central account,” he said.
He added that the unmerited Shs 521 million represents excess revenue that must be included in a supplementary budget before it can be released back to the district.
District leaders are urging the Ministry of Finance to expedite the supplementary budget process to prevent further disruption of essential services. They warn that prolonged delays could worsen the situation, affecting everything from garbage collection and sanitation to infrastructure monitoring and community mobilisation.