Bank of Uganda has refuted claims that government owes them money to the tune of pay Shs11 trillion as the leader of the opposition Mathias Mpunga claimed on the floor of parliament in a message read on his behalf by Butambala County MP, Muwanga Kivumbi.
The central bank said Section 4 of the Bank of Uganda Act, 2000 mandates them to perform the functions of Banker to Government and Agent of Government in financial matters.
And as a Banker of Government, BoU can grant advances to Government in accordance with the Bank of Uganda Act, 2000 and the Public Finance Management Act, 2015 (as amended).
“In line with these laws, the Government obtained an advance of UGX 2.1 trillion in FY 2020/21, which was subsequently repaid in full. Since then, no such borrowing has taken place. Therefore, Government has not borrowed UGX 8 trillion and there is no such outstanding loan from BoU as purported in the article,” BOU said in a Tuesday press statement.
Also, as an Agent of Government in financial matters, BoU manages the issuance and redemption of domestic debt securities on behalf of the Government. This, the central bank said, entails prompt repayment of matured government securities to investors.
BoU said: “The current outstanding amounts due from Government to BoU relate to reimbursables attributed to this role. As of 30 June 2021, the outstanding reimbursables to BoU stood at UGX 3.033 trillion.
Adding: “During the FY 2021/22, BoU made repayments of matured securities to investors worth UGX 11.940 trillion and received reimbursements from Government worth UGX 11.602 trillion. Therefore, the Government’s outstanding reimbursables to BoU as of 30 June 2022 stood at UGX 3.371 trillion.”
“In the current financial year (FY 2022/23), BoU has made further repayments of matured securities worth UGX2.510 trillion and received reimbursements from Government worth UGX 1.871 trillion; resulting in outstanding reimbursables of UGX 4.010 trillion as at 15 September 2022,” BoU said.