Agriculture financing and sector performance in Uganda, 2013

Performance of the Agricultural Sector in Uganda - Case Study of Donor-Funded Projects

Agriculture Financing and Sector
Perfomance in Uganda
Case Study of Donor-Funded Projects

SBAG

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d g e ti n g f o r e
1

Table of Contents

Acronyms and Abbreviation 4 Chapter 3 Performance of Completed Agricultural Loans 27
3.1 Vegetable Oil Development Project 27
SBAG 3.2 Agricultural Improved Rice Production 31
Glossary 5
C

Acknowledgements 6
Chapter 4 Performance of Ongoing Agricultural Loans 36
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4.1 Creation of Tsetse and Trypanomiasis Free Areas 36
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Forum for Women in Democracy
4.2 Farm Income Enhancement Project –
Performance of the Agricultural Sector in Uganda is published by the
Foreword 7 Irrigation Component 39
Civil Society Budget Advocacy Group (CSBAG) supported by Actionaid Uganda Chapter 5 Conclusions and Recommendations 42
Chapter 1 Introduction 10 5.1 Conclusions 42
© 2012 c/o 1.1 Overview 10 5.2 Recommendations 47
Forum for Women in Democracy (FOWODE) 1.2 Study Objectives 11 References 50
P.O. Box 7176, Kampala 1.3 Methodology 12
Tel: +256-41-286063 1.4 Report Structure 14
E-mail: fowode@fowode.org
Web www.fowode.org Chapter 2 Agriculture Sector Performance 15
2.1 Introduction 15
All rights reserved. No part of this publication may be reproduced, or 2.2 Growth trends 16
reprinted in any form by any means without the prior permission of the 2.3 Financing and expenditure trends 17
copyright holder. Nevertheless, CSBAG and Actionaid Uganda encourage 2.4 Delivery of key agricultural services 19
its use and will be happy if excerpts are copied and used. When doing so,
however please acknowledge CSBAG and Actionaid
3

Acronyms & Abbreviation Glossary

Budget Support Mode of financing that involves transfer of financial resources of a development partner to the
ACF Agricultural Credit Facility MTEF Medium Term Expenditure Framework
consolidated fund following the fulfillment of agreed conditions for disbursement. The funds are
Ag HH Agricultural Household NAADS National Agricultural Advisory Services
part of the national resource and are appropriated by Parliament. They are used in accordance
ADF Agricultural Development Fund NAP National Agricultural Policy with the public financial management system of Uganda
ATAAS Agricultural Technology and Agricultural Advisory NARI National Agricultural Research Institute
Services NARO National Agricultural Research Organization
CAADP Comprehensive Africa Agricultural Development Program
Food Security Farmer Any farmer who is 18 years and above, a practicing subsistence farmer
NARS National Agricultural Research System
CDO Cotton Development Organization NDP National Development Plan
CSBAG Civil Society Budget Advocacy Group NEPAD New Partnership for Africa’s Development Off-Budget funds Resource flows that are managed outside the Government systems of planning, appropriation,
CSO Civil Society Organization PEAP Poverty Eradication Action Plan budgeting and procurement. Government procedures are generally not used in full in managing
DDA Dairy Development Authority PMA Plan for Modernization of Agriculture these funds. Includes off budget project aid.
DSIP Development Strategy and Investment Plan SACCO Savings and Credit Cooperative Society
FIEFOC Farm Income Enhancement Project STATFA Creation of Tsetse & Trypanosomiasis Free Areas On-budget funds Resource flows that are managed through the country’s public financial management systems
FOWODE Forum for Women in Democracy UA Unit of Account within the MTEF and approved by Parliament. Includes on budget project aid.
FSF Food Security Farmer UBOS Uganda Bureau of Statistics
GDP Gross Domestic Product UCA Uganda Census of Agriculture Project Support Aid modality that entails agreement between the development partner or donor and
GOAR Government Outlays Analysis Report UCE Uganda Commodity Exchange Government on a set of inputs, activities and outputs to reach specific outcomes within a defined
GoU Government of Uganda UCDA Uganda Coffee Development Authority time frame, area and budget. This approach allows use of the donor accounting systems.
KCCA Kampala City Council Authority UNHS Uganda National Household Survey
KOPGT Kalangala Oil Palm Growers Trust VODP Vegetable Oil Development Project Technical Assistance Involves the transfer of ideas, knowledge, practices, technologies or skills to foster economic
MAAIF Ministry of Agriculture, Animal Industry and Fisheries WRS Warehouse Receipt System development. Usually for policy development, institutional development, capacity building and
MDG Millennium Development Goal ZARDI Zonal Agricultural Research and Development Institute. project or programme support.
MFPED Ministry of Finance, Planning and Economic Development
MOF Market Oriented Farmer

4 5


Acknowledgements
This report is a joint undertaking of the members of the Civil
Foreword
Society Budget Advocacy Group (CSBAG) which since 2004
has advocated for pro poor and gender sensitive policies and
budgets. Several individuals and organizations have helped
shape the outcome of this report and these include Actionaid
Uganda, Forum for Women in Democracy (FOWODE), Daniel
Lukwago, Frederick Kawooya, Francis Akorikin, Sophie Kyagulanyi,
and Dr. Bbaale Edward who reviewed this report and provided
technical feedback.

This report was produced under supervision of Julius Mukunda
whose technical insight guided the research team at different
stages which greatly enriched this report. Although agriculture contributes greatly to the economy and a
signiﬁcant proportion of the poor depend on it, Public expenditure
Special thanks go to Actionaid Uganda whose financial and
technical support enabled the successful production of this
in this sector has declined significantly over the past financial
report. years; with the share of the sector ranging from between 3-4%
of the national budget causing a decline in Uganda’s agricultural
output and productivity. Uganda’s agricultural growth rate is still
below the 6 percent annual growth target of the African Union’s
Comprehensive Africa Agricultural Development Program (CAADP).
To effectively engage the Government of Uganda Irrigation Component, The study provides an in‐ into concrete actions in improving agricultural
to reverse the trend, and enhance investment depth assessment of how agricultural loans have financing and that different actors including
in the sector, the Civil Society Budget Advocacy been applied in Uganda to improve agricultural the Civil Society, Government, Donors and the
Group [CSBAG] in 2012 deemed it necessary to performance. It further analyzes the spending famers will work collectively towards promoting
undertake a study that will facilitate a deepened patterns and service delivery within agriculture the CAADP agenda of reaching a higher path
understanding on how resources are being and brings out the salient issues for action. of economic growth through agriculture-led
used within this sector. Using case studies of development in Africa .
four donor funded projects -the Vegetable Oil There are significant factors affecting the sector’s
Development Project, Agricultural Improved Rice, performance that are highlighted in this study Julius Mukunda
Production Creation of Tsetse and Trypanomiasis that need redress and, it is our hope that Coordinator-Civil Society Budget Advocacy Group
Free Areas, Farm Income Enhancement Project – recommendations made in this study will result
6 7

Executive Summary Key Recommendations
Study Context policy and institutional development yet the low implementation/institutional capacity in 1) The budget allocation to the agricultural and accountability systems so that donors 7) Value for money in donor funded projects
External assistance flows to Uganda have aver- MAAIF continues to lack sufficient implemen- the Ministry of Agriculture, Animal Industry sector needs to be stepped to at least 10% of have a high level of trust in them and can use should be encouraged. Expenditures should
aged about US$ 760 million annually between tation capacity. and Fisheries. Although funds absorption the national budgetary resources to expand them instead of the lengthy donor systems. be on critical areas that address the project
2001 and 2010. The agricultural sector attracts was high, it was for the wrong reasons, with delivery of agricultural services in Uganda. objectives and give results. Poor allocative
part of the donor funding for enhancing various 3) A major challenge is the slow disbursements 87% of the resources being spent on general This could include deepening of delivery of 4) The Government should take lead in the efficiency whereby the bulk of resources
services to farmers. Of concern, however is the of donor funds in the sector in turn leading operating expenses without any tangible out- extension and research services to ensure planning, designing and implementation of are spent on consumptive or recurrent
slow disbursement of donor funds in the sector to slow implementation of donor funded come. that farmers access and use improved inputs donor funded projects to enhance ownership unproductive expenditures should be
which has led to slow implementation of donor interventions. In FY 2011/2012, 74% of the and technologies to bridge the production and proper supervision of the projects. The discouraged.
funded projects. total loan portfolio equivalent to US$ 341.55 7) Whereas planning and project design is usu- and productivity gap at farm level. Sufficient Government should have an active role in
remained undisbursed. ally done jointly between MAAIF and donor counterpart funding should be provided in budgeting and utilization of the donor funds. 8) There is a need for the Government to
The overall aim of this study was to assess the agencies, there are instances where the do- adequate and a timely manner for marching encourage and support the development of
performance status of agricultural services in nor takes lead which leads to low ownership with the donor funds. 5) Gender planning, budgeting and monitoring public private partnerships in the delivery of
4) The four case study loans bring out many
Uganda and utilization of resources to implement of interventions by the beneficiaries and less should be core to all donor projects. Gender agricultural services in Uganda as a means to
factors that singularly or in combination slow
programmes and policies. The study involved project impact. 2) The way donor funded projects in the and equity budgeting should go beyond fill the gap. For example, Government could
implementation of donor funded projects.
analyzing the performance of four loans (donor agricultural sector are packaged should seeking involvement of women and other partner or support farmer associations,
For example, the poor design of the FIEFOC
funded projects) in terms of planning, budgeting 8) Generally, gender mainstreaming is not pri- be reviewed to enhance reach, impact and marginalized groups to promoting equitable NGOs and private sector players to scale up
irrigation project slowed funds disbursement
and implementation. The extent to which gender oritized in agricultural loans. sustainability. Rather than soliciting for access and use of agricultural services good models of extension that are littered in
and project implementation. ADB Funded
issues were addressed in these projects was as- small discrete projects that have limited and monitoring progress made thereafter. different parts of the country.
projects generally have long bureaucratic
sessed. The study used secondary data sources 9) Delivery of agricultural services such as exten- impact, the Government should focus on Clear gender mainstreaming strategies
procurement processes that delay disburse-
complemented by primary information collected sion, credit and research is ongoing although encouraging donor funded projects that are should form part and parcel of the project
ment of funds. The Government of Japan and 9) District and Sub-county officials of the
by the Ministry of Finance, Planning and Econom- reach to majority of farmers remains low. Ac- larger and impactful with adequate reach implementation plan.
FAO took lead in the implementation of the respective Local Governments that are
ic Development. cess to extension services remains low, with geographically and in terms of number of
Agriculture improved Rice Production proj- to be involved in implementation of a
80% of the agricultural households having beneficiaries targeted and quantity of inputs 6) The institutional and implementation
ect which led to distribution of poor quality donor funded project should be involved
not been visited by an extension worker in and technologies provided. capacity of the agency that is to implement
inputs, the bulk of funds being used in recur- early in the project design, planning and
Key conclusions the recent agricultural survey of 2008/2009. the donor funded projects should be
rent expenditures indicative of poor alloca- execution of the project. This will enhance
3) Some level of flexibility in the prior properly scrutinized at planning stage and
1) The budget allocation to agriculture as a tive efficiency and low project sustenance. project ownership by the beneficiaries
10) Whereas the bulk of agricultural service deliv- conditions and minimal conditionalities beefed up before project commencement.
share of the national budget remains low, at and sustenance of the interventions and
ery is undertaken at local government level, imposed by donors for project trigger Where possible, the implementing agency
3.2% in FY 2012/2013. Most funds are dis- outcomes.
5) The VODP case study illustrates that they are the district and sub-county officials are not should be espoused as a means of avoiding can partner with other Government and
bursed as small discrete projects whose con- adequately involved in the project design, unjustifiable low absorption of funds. It is non-Government agencies to scale up
loans in the agricultural sector that perform
tribution is not impactful and nor sustainable. planning and budgeting stages. Often, they critical that the prior conditions are well the implementation capacity to march the
well with regard to absorption of allocated re-
sources, timely implementation and achieve- brought late into the implementation stage negotiated and are easily implementable. project requirements.
2) The agricultural sector attracts less than which lessens ownership, supervision and Government should improve its procurement
ment of the intended outcomes.
10% of the donor assistance in Uganda that sustainability of the donor funded projects.
is channeled to the development budget. A
6) The FIEFOC case study illustrates that some
substantial part of external support to the
projects are complete failures because of
sector is in form of Technical Assistance
8 9


Figure 1.1: Allocation of Donor Assistance to the Figure 1.2: Disbursed and undisbursed loan commitments across sectors

Introduction
Development Budget for FY 2011/2012
Chapter 1
1.1 Overview Agriculture loans in this report
refer to funds1 that are received
There are also substantial official
resource flows that are delivered
addition and enhancing compliance
with food safety requirements in the
by Government of Uganda (GoU) to projects but managed outside export markets. A substantial part
This is a report of a from external donors to finance the Government systems. The bulk of external support to agriculture
key interventions within the sector. of donor funds in agriculture are comes in form of technical
research commissioned The report analyzes the spending on-budget. For example, during assistance for policy and institutional
by the Civil Society patterns and service delivery within FY 2010/2011, the sector received development and capacity
Budget Advocacy agriculture and uses selected case US$ 58.30 million on budget and enhancement. The Government
Group on agricultural studies of donor financed projects to US$ 16.07 million off budget. The still faces a challenge of capturing
sector performance in bring out the salient issues for action. off budget funds were provided by all donor and technical assistance
USAID, UK, Norway and FAO4. The as some of the funds are handled
Uganda. The motivation The agricultural sector in Uganda study focused on donor funds that directly by the donors.
for the study is rooted primarily encompasses crops, are on-budget.
in the need to get a livestock, fisheries and forestry. Of concern, however, is the slow
Source: MFPED, 2012b. Source: MFPED, 2012b.

clearer picture of how Donor funds that are channeled The agriculture sector attracts disbursement of donor funds in During FY 2011/2012, the agriculture sector had • New loans commitments that are contracted resources to implement programmes and
in the sector are either under the less than 10% of the total donor the sector which has led to slow a total loan portfolio equivalent to US$ 466.80
agricultural loans have budget or project support aid assistance for the development implementation of donor funded million; of this amount, US$ 119 million (or 26%)
but take long to become effective.
• Some funds not directly controlled by
policies.

been applied in Uganda modality. In recent years, external budget. In FY 2011/2012, the sector interventions. Agriculture is one of had been disbursed and US$ 341.55 million Government; expenditure is by the The study had 7 objectives:
remained undisbursed. Joint reviews between
to improve agricultural financing from donors accounts for attracted 8% of the donor assistance the sectors with large undisbursed
MFPED and Development partners suggest a
development partners.
1) Provide an overview of the sector
performance. about 25% of the budget and 6% (Figure 1.1). The donor funding is loan commitments (Figure 1.2). number of explanatory factors for this scenario5: This study used the case studies to draw out performance, highlighting key priority issues.
of Gross Domestic Product (GDP)2. aimed to complimenting Government Note that loan disbursements to lessons on the key constraints to utilization of 2) Identify four Government loans – two
External assistance flows to Uganda efforts in number of areas including: agriculture are channeled mainly • Inadequate and untimely release of donor finances in the agricultural sector. that had ended and another two whose
have averaged about US$ 760 million improving control and mitigation to MAAIF and its agencies but also Government counterpart funding implementation was still ongoing under the
• Complex procurement procedures that are agricultural sector.
1.2 Study Objectives
annually between 2001 and 20103. capacity of crop pests and livestock a significant fraction is earmarked
required by donors 3) Review the performance of the completed
1 These may be loans , grants or technical diseases; deepening access to to agricultural programmes under • Capacity constraints with institutions relating agricultural loans in terms of budgeting,
assistance. markets; capacity for research and Ministry of Local Government (MOLG) to personnel, systems and procedures The main purpose of the study was to assess planning and implementation.
2 MFPED, 2012b. generating new technologies, value and districts. • Poor design of projects the performance status of agricultural services 4) Identify key pertinent gender issues and
3 MFPED, 2012d. 4 MFPED, 2012c. (extension, research, credit, finance, markets, how they were addressed in the completed
food security) in Uganda and utilization of projects.
10 5 MFPED, 2012b. 11


5) Make recommendations on how the projects performed and
improvements for future projects. 1.3 Methodology Identification of case study Table 1.2: Case Study donor funded projects
No. Project Status of Implementation Key selection criteria
6) For the ongoing projects, analyze how the projects are performing
based on set benchmarks.
projects
The study relied on secondary data sources, including primary information The first step involved listing all donor 1 Vegetable Oil First phase completed; • PPP implementation arrangement
7) Make recommendations for the ongoing projects regarding how to that had been collected by MFPED on the selected donor projects. Table 1.1 funded projects in Uganda (Annex 1) Development Second phase recently • Funded by IFAD-GoU
address gender issues. summarizes the approach used in addressing each of the study objectives. from which the case study projects could Project started. • Reported to be performing well.
be selected. The following criteria guided • Implemented in Kalangala district and
project selection: The focus will be on the Northern Uganda. Focus will be on the
Table 1.1: Methodological approach to study objectives concluded phase. Kalangala Component
Objective Approach • Projects must have benefitted from • Has both a completed and an ongoing
donor loans; all projects that are phase.
1. Provide an overview of the sector In addition to macro level trend data in the agricultural sector, the areas that were highlighted in
solely Government funded were not • Implemented directly by MAAIF
performance, highlighting key priority the overall purpose of the study were analyzed, namely: extension, research, credit, finance, markets
considered. • Focus is on promoting oil palm plantation
issues. and food security. Desk review of secondary data sources at Uganda Bureau of Statistics (UBOS), MAAIF, MFPED,
NAADS Secretariat, PMA Secretariat, FOWODE, VEDCO, Action Aid, Oxfam, DRT, World Bank. • Implemented by MAAIF or its agriculture.
associated agencies for policy • Information easily accessible
2. Identify four Government loans – Reviewed secondary data in MFPED loans and grants reports; Approved Estimates; Public
influence. 2 Creation of Ongoing • ADB-GoU funded
two that had ended and another Investment Plans and MAAIF Output Oriented Budgeting Tool (OBT); Ministerial Policy Statements.
• Easily accessible data and tsetse and • Countrywide
two whose implementation was still Other details are below.
information; frequently monitored trypanosomiasis • Directly implemented by MAAIF
ongoing under the agricultural sector
programmes. areas • Reported to be poorly performing
3. Review the performance of the Reviewed primary data that was collected by the Budget Monitoring and Accountability Unit (BMAU) • Projects that are reported to be • Focus on control of trypanosomiasis and
completed agricultural loans in and budget monitoring reports. Also reviewed project documents, including evaluation reports. performing well as well as those that tsetse fly infestation.
terms of budgeting, planning and are seen to be performing poorly. • Information may not be easily accessible.
implementation • A mix of donors that funded the
4. Identify key pertinent gender issues chosen projects 3. Agricultural First phase completed • Japan-GoU funded
and how they were addressed in the Authors’ analysis of all available primary and secondary data and information. The gender issues • Different enterprise focus. Improved rice and second phase is near • MAAIF implemented
completed projects. were identified within the context of the analysis and not as a separate section. • Projects that have public-private production completion • Focus on promoting growing of improved
partnership (PPP) investment (NERICA project) rice varieties, the NERICA types.
components. • Both good and poor performance
5. Make recommendations on how the reported.
projects performed and improvements Authors’ analysis of all available primary and secondary data. • Information easily accessible
for future projects. On the basis of the above criteria, the
four case study projects that were 4 Farm Income Ongoing • ADB-GoU funded
6. For the ongoing projects, analyze how Reviewed primary data that was collected by the Budget Monitoring and Accountability Unit (BMAU)
selected for analysis were: Vegetable Oil Enhancement • Focus on rehabilitating four large
the projects are performing based on and budget monitoring reports. Also reviewed project documents, including evaluation reports.
Development Project (VODP); Creation Project – the irrigation schemes.
set benchmarks.
of tsetse and trypanosomiasis areas; Agricultural • MAAIF implemented and recently
Agricultural Improved rice production Component transferred to MWE due to reported poor
7. Make recommendations for the and Farm Income Enhancement Project performance
ongoing projects regarding how to Authors’ analysis of all available primary and secondary data. (FIEFOC) – Agricultural Component (Table • Information fairly accessible
address gender issues. 1.2).

12 13


1.5 Report Structure
The report is structured in five chapters:
Chapter 2 Agriculture Sector Performance
• Chapter 1: Introduction
• Chapter 2: Agricultural Sector Performance
• Chapter 3: Performance of Completed 2.1 Introduction Agriculture is categorized as a primary
growth sector. At the sector level, two key
through coordinated interventions that
focus on enhancing productivity and
Agricultural Loans policy documents guide implementation: value addition, providing employment
opportunities, and promoting
• Chapter 4: Performance of Ongoing A key objective of the study was to provide an the National Agricultural Policy (NAP)
which is still under development and domestic and international trade. The
Agricultural Loans
• Chapter 5: Conclusions and overview of agricultural sector performance to the MAAIF Development Strategy and Development Strategy and Investment
Recommendations contextualize the study findings. At the macro level, Investment Plan (DSIP) 2010/11 – Plan (DSIP) is the medium term strategic
plan for MAAIF. The DSIP has two high
agricultural sector interventions are guided by the 2014/15.
level objectives or intended outcomes: (1)
National Development Plan (NDP) that aims to enhance The overall policy objective of the Rural incomes and livelihoods increased;
agricultural production and productivity as a means of NAP is to promote food and nutrition (2) Household food and nutrition security
improved.
increasing household incomes and promoting equity. security and household incomes

The Civil Society Budget Advocacy Figure 2.1: Distribution of working population in Uganda in Uganda by sector (%)
Group (CSBAG) has since 2004
brought together CSOs at national
and local level to advocate for
budgets that address the needs of
poor women and men.

The largest proportion of the working population in Uganda
(66%) derives its livelihood from agriculture (Figure 2.1).
Of policy concern however is why such a large population
engaged in agriculture contributes only 14% to the national
output, indicative of low factor productivity. This issue is further
explored in section 2.4 below.

Source: UNHS 2009/10

14 15


The Uganda Census of Agriculture (UCA) The rest of this chapter discusses sector
performance from three key dimensions: (1)
high inflation levels2. Although agriculture Table 2.1: Sectoral Growth Rates and Shares in GDP 2003/04 – 2011/12
2008/091 estimated that the number of remains very critical for spurring national
Growth trends (2) Financing and expenditure Sector 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12
agricultural households in Uganda are 3,945,753. growth, the share of agriculture in total GDP
Out of these, the Western Region had the trends and (3) Delivery of key services. has declined over the years from 23.8 percent Sector Growth Rates
highest (28.5%), closely followed by the Eastern in FY 2003/04 to 13.9 percent in FY 2010/11. Agriculture 1.6 2.0 0.5 0.1 1.3 2.9 2.4 0.7 3.0
Region (28.1%), Northern Region (22.9%) and Whereas the industrial and services sectors
Central Region (20.5%). Of the 3,575,065
agricultural households that responded to the
2.2 Growth trends have in some years hit a 10% growth rate, the
growth in the agricultural sector has consistently
Industry
Services
8.0
7.9
11.6
6.2
14.7
12.2
9.6
8.0
8.8
9.7
5.8
8.8
6.5
8.2
7.9
8.4
1.1
3.1
census, 2,821,070 or 78.9% were male headed Uganda’s economy grew at an average GDP remained dismal at 3% (Table 2.1)3. Sector Shares in Total GDP at Current Prices
households and 753,994 or 21.1% were female growth of 7.8 percent between FY 2005/06
and FY 2010/11, and slowed down to 3.2 Agriculture 23.8 25.1 18.3 16.9 15.8 15.1 14.7 13.9
headed households (Figure 2.2). The growth of the agricultural sector is still below
percent in FY 2011/2012 as a result of high the National Development Plan (NDP) annual Industry 22.9 23.5 24.8 25.1 25.1 24.8 25.0 25.3
global oil and commodity prices, drought, growth target of 5.6 percent and the 6 percent Services 47.4 45.4 49.6 49.6 49.9 50.7 51.6 52.4
1 UBOS, 2010.
power shortages, exchange rate volatility and growth rate that is required for effective poverty Source: UBOS Statistical Abstracts for various years; MFPED, 2012; MFPED, 2011; GoU, 2010.
reduction. Research by IFPRI4 demonstrated
Figure 2.2: Percent distribution of Agriculture Household Heads by Sex and Region that if agriculture in Uganda grew at 6 percent
per annum, the national poverty headcount
level would decline from 31.1 percent in 2005
to 19.9 percent in 2015, below the 28 percent 2.3 Financing and expenditure trends
Millennium Development Goal (MDG) target.
The Ministry of Agriculture, Animal Industry and 3 grants: (i) District Agricultural Extension (ii)
Uganda’s agricultural growth rate is also below
the 6 percent annual growth target of the African Fisheries (MAAIF) is the lead agency coordinating NAADS (Districts) (iii) Production and Marketing
Union’s Comprehensive Africa Agricultural agricultural financing both at the Central and Grant. Public funds include GoU and donor
Development Program (CAADP)5. Local Government level. At Central Government financing.
level, financing is handled through 7 Votes
namely: (i) MAAIF (ii) NAADS Secretariat (iii) The budget allocation to agriculture as a share to
Cotton Development Organization (CDO) (iv) the national budget remains low (Table 2.2) and
Uganda Coffee Development Authority (UCDA) stands at 3.2% in FY 2012/2013 which constrains
(v) National Agricultural Research Organization agricultural spending6.
(NARO) (vi) Dairy Development Authority (DDA)
and (vii) Kampala City Council Authority (KCCA)
2 MFPED, 2012.
Grant. At the Local Government level, spending
3 MFPED, 2012.
for agriculture is majorly channeled through
4 Benin, 2007.
5 The CAADP is an initiative of the New Partnership 6 At the African Union Assembly in Maputo in July 2003,
for Africa’s Development (NEPAD) aimed at helping African Heads of State including the Ugandan President, committed
countries reach a higher path of economic growth through to allocating at least 10% of national budgetary resources to
agriculture-led development. agriculture within 5 years of the meeting date.
Source: UBOS, 2010.

16 17


Table 2.2: Sectoral Budget Allocations – FY 2009/10 – FY 2011/12 Figure 2.3: Budget allocations within the Table 2.3: On-budget and Off-budget Project Aid to Agriculture (US$ millions)
Sector 2009/10 Approved 2010/11 Approved 2011/12 Approved Agricultural Sector FY 2011/12 On-budget Off-budget
Allocation % Share Allocation % Share Allocation % Share Sector Actual Projections Actual Projections
USh bn of Budget USh bn of Budget USh bn of Budget 2009/10 2010/11 2011/12 2012/2013 2009/10 2010/11 2011/12 2012/2013
Agriculture 310.7 4.7% 366 5.0% 434.0 4.5% Agriculture 68.07 58.30 94.47 100.01 9.51 16.07 23.89 37.20
Lands, Housing & Urban Development 20.3 0.3% 24 0.3% 32.4 0.3% Total all 641.59 515.62 867.36 687.66 399.55 397.30 451.55 402.06
Energy & Mineral Development 698.9 10.5% 391 5.3% 1,320.0 13.7% Sectors
Works & Transport 1,214.8 18.2% 1,038 14.1% 1,290.8 13.4% Agric Share
Information & Communications Technology 9.5 0.1% 12 0.2% 12.1 0.1% %
Source: MFPED, 2012c – Information
Tourism, Trade & Industry 47.8 0.7% 49 0.7% 53.2 0.6% The programme is implemented in all
submitted by Development partners by
districts and sub-counties of Uganda,
Education 1,079.6 16.2% 1,243 16.8% 1,416.3 14.7% February 2012.
involving provision of advisory services and
Health 737.7 11.0% 660 8.9% 799.1 8.3% inputs to various categories of farmers
Water & Environment
Social Development
172.2
32.5
2.6%
0.5%
250
32
3.4%
0.4%
271.3
50.4
2.8%
0.5%
2.4 Delivery of key and setting up of technology development
sites and research trials. The first phase of

Security 487.7 7.3% 649 8.8% 974.9 10.1% agricultural services the project ended in 2010 and the second
phase commenced in FY 2010/11 under the
Justice, Law & Order 359.7 5.4% 532 7.2% 531.6 5.5% Agricultural Technology and Agri-business
Advisory Services Project (ATAAS). The ATAAS
Public Sector Management 705.0 10.6% 835 11.3% 986.2 10.2% 2.4.1 Extension aims to strengthen the linkages between
Accountability 462.9 6.9% 492 6.7% 543.6 5.6% The Government is offering agricultural NAADS and the National Agricultural
extension and advisory services to farmers Research Organization (NARO) and increase
Legislature 121.8 1.8% 163 2.2% 162.7 1.7% Source: MFPED, 2012a.
mainly through the National Agricultural agricultural productivity and farmer access to
Public Administration 217.0 3.2% 302 4.1% 231.8 2.4% technology, advice and information.
Advisory Services (NAADS) programme,
Interest payments due - - 340 4.6% 519.6 5.4% complemented by general extension services
by the District and Sub-county Production The NAADS program has enabled farmers
Grand Total 6,678.3 100.0% 7,377 100.0% 9,630.0 100.0%
Offices. Other farmers pay to access private to access inputs and technologies: in FY
Source: MFPED, 2010a; MFPED, 2011a; MFPED, 2012; DRT, 2011. 2010/11, the programme targeted 100
sector service providers, especially in the
Close to a half of agricultural spending (42.4%) comes in discrete projects whose contribution livestock sector. The main objective of the Food Security Farmers (FSF) and 8 Market
to the overall sector outc omes cannot be easily NAADS programme that has been under Oriented Farmers (MOFs) per Parish; this
is earmarked to the NAADS programme that
implementation since 2001 is to “ensure that number has gradually come down due to
offers advisory services to farmers, followed by ascertained or measured. A significant amount of
farmers move from subsistence to market resource constraints to 30 FSF per parish,
policy and institutional development by MAAIF aid also comes off budget and its magnitude and
oriented and eventually commercial farming”. 4 MOF per parish and 2 commercializing
and research and technology development by use is not well captured in Government systems.
farmers per Sub-county. The FSF are
NARO (Figure 2.3). Most of the donor financing Table 2.3 provides a snapshot of project aid to
agriculture in recent years.
18 19

Agriculture financing and sector performance in Uganda, 2013

Agriculture financing and sector performance in Uganda, 2013

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