KAMPALA– Financial institutions have welcomed the government’s move to allocate UGX 1.4 trillion in the 2025/26 national budget towards clearing domestic arrears, saying it will significantly boost liquidity in the private sector.
Speaking during the 2025/26 post-budget dialogue held in Kampala this morning, the Managing Director of Absa Bank Uganda, David Wandera, said the long-overdue government payments have placed considerable strain on private sector players.
He noted that the allocation signals a strong commitment by the government to settle its obligations, which will in turn unlock much-needed cash flow for businesses.
“The private sector has been heavily burdened by delayed payments from government contracts. This move to clear arrears is a game-changer—it will boost business confidence, improve cash flow, and stimulate economic activity,” Wandera said.
He also emphasized that the timely disbursement of the allocated funds will be crucial in realizing the intended economic impact.
Meanwhile, the Managing Director of Nation Media Group Uganda, Suzan Nsibirwa, highlighted the importance of simplifying the national budget for the public.
She urged the media to play a proactive role in breaking down budget allocations and priorities in a way that ordinary citizens can understand and appreciate.
“As media, we have a responsibility to demystify the budget and show communities how the figures translate into tangible services and opportunities. People need to know how this budget affects their daily lives,” Nsibirwa said.
Finance Minister Matia Kasaija, while reading the 2025/26 national budget yesterday, he announced the allocation of UGX 1.4 trillion specifically earmarked to clear domestic arrears owed to suppliers and contractors.
The post-budget dialogue brought together key stakeholders from the financial sector, media, civil society, and government to reflect on the implications of the budget and explore ways to drive inclusive economic growth.
