STATUTORY INSTRUMENTS 2005 No. 31.

THE PUBLIC FINANCE AND ACCOUNTABILITY (AMENDMENT) REGULATIONS,

2005.

ARRANGEMENT OF REGULATIONS

Regulation

STATUTORY INSTRUMENTS

2005 No    The Public Finance and Accountability (Amendment) Regulations, 2005.

(Under section 46 of the Public Finance and Accountability Act, 2003,

Act No. 6 of2003).

In exercise of the powers conferred upon the Minister by section 46 of the Public Finance and Accountability Act, 2003, these Regulations are made this 29th day of December, 2004.

1. Title

These Regulations may be cited as the Public Finance and Accountability (Amendment) Regulations, 2005, and shall be read as one with the Public Finance and Accountability Regulations, 2003, in these Regulations referred to as the “principal Regulations”.

2. Amendment of regulation 2 of principal Regulations

Regulation 2 of the principal Regulations is amended by inserting in the appropriate alphabetical order, the following definitions—

“Appropriation Account” means the account where the funds appropriated to a vote by Parliament through an Appropriation Act are credited;

“donor funded budget” means that part of the Government budget, which is funded directly from funds raised in the form of grants or loans from donors;

“donor funded project” means any project, which is funded directly from funds raised in the form of grants or loans from donors, whether wholly or partly;

“secretary to the Treasury” means the person empowered to carry out those duties as per section 6 of the Act;

“stores” means inventories of public assets, current or non-current, tangible or intangible, held by an Accounting Officer.

3. Amendment of regulation 8 of principal Regulations

Regulation 8 of the principal Regulations is amended—

1. by deleting the semi colon after the words “and promulgation of statutory

instrument” and substituting a full stop; and

2. by deleting the words “and in the case of charges for Government

services, the costing should be done on the basic principle that the cost of the services should be covered by the revenue obtained from the charges raised.”.

4. Revocation of regulation 15 of principal Regulations

Regulation 15 of the principal Regulations is revoked.

5. Amendment of regulation 25 (2) of principal Regulations

Regulation 25 of the principal Regulations is amended by substituting for subregulation (2) the following—

“(2) The Board of Enquiry shall comprise not less than three members, who shall not be employees of the same Ministry or department, appointed by the Secretary to the Treasury.”.

6. Amendment of regulation 26 (1) (a) of principal Regulations

Regulation 26 of the principal Regulations is amended by substituting for sub­regulation (1) (a) the following—

“(a) the amount involved in any loss should be written off in accordance with section 41 of the Act; or if outside his or her powers, be recommended for write off; or".

7. Revocation of regulation 30 (2) (b) of principal Regulations

Sub-regulation (2)(b) of regulation 30 of the principal Regulations is revoked.

8. Amendment of regulation 38 (3) of principal Regulations

Sub-regulation (3) of regulation 38 of the principal Regulations is amended by substituting the word “approval” for the words “appropriation by a Supplementary Appropriation Act” appearing at the end of the sub-regulation.

9. Revocation of regulation 39 (4) of principal Regulations

Sub-regulation (4) of regulation 39 of the principal Regulations is revoked.

10. Amendment of regulation 42 (l) of principal Regulations

Regulation 42 of the principal Regulations is amended by substituting for sub­regulation (1) the following—

“(1) Parliament votes funds for the service of the financial year on the basis of the amounts expected to be available in the course of the year; and therefore only expenditure incurred during a financial year can be recorded in the Appropriation Accounts.”.

11. Amendment of regulation 42 (2) of principal Regulations

Regulation 42 of the principal Regulations is amended by substituting for sub­regulation (2) the following—

“(2) All revenues received or earned by a vote during a financial year shall be accounted for in accordance with Accounting Instructions issued by the Accountant General.”.

12. Amendment of regulation 43 (4) (a) of principal Regulations

Regulation 43 (4) of the principal Regulations is amended by substituting for paragraph (a) the following—

“(a) the purposes for which the Fund is being established are to be defined by the Minister.”.

13. Insertion of new regulation 55A after regulation 55 of principal Regulations.

The principal Regulations are amended by inserting a new regulation 55A immediately after regulation 55 to read as follows—

55A. Measures to strengthen management of public debt.

1. The Minister shall take such measures as he or she may consider necessary to strengthen the management of the public debt with a view to achieving long-term debt sustainability.
2. Measures taken under sub-regulation (1) shall ensure that—

1. all borrowing is properly evaluated and is in full compliance with the

Government’s external debt strategy;

2. annual limits of the Government’s Net Present Value (NPV) of debt

to exports ratio are set and presented in each fiscal year’s budget;

3. new borrowing limits, consistent with the NPV debt to exports

target, are set out for each financial year in United States dollar terms and presented in the annual budget;

4. Government’s new external borrowings on an annual basis shall not,

in aggregate, exceed the annual limit set out in sub-regulation

(c)r.

14. Insertion of new regulation 58A after regulation 58 of principal Regulations

The principal Regulations are amended by the insertion of a new regulation 58A immediately after regulation 58 to read as follows—

58A. “Offsetting of payments against liabilities.

(1) Any form of payment involving offsetting assets against liabilities shall only be done with the prior written approval of the Accountant General; and any such approval shall be copied to the Auditor General.

(2) Where the offset is other than debtor-creditor relationship and involves physical assets, the Chief Government Valuer shall be required to value the assets concerned.”.

15. Amendment of regulation 67 of principal Regulations

Regulation 67 of the principal Regulations is amended by substituting for sub­regulations (1) and (2) the following—

67. “Authority for advances.

1. The grant of advances from public moneys or funds is strictly limited and such advances may only be made by the Accountant General under the authority of an advance warrant under the hand of the Minister and for the purposes stated in the Act.
2. All advances made under sub-regulation (1) shall be retired in the financial year in which they are made, and no advance account shall be opened, nor may any action be taken by any public officer, which shall result in the issue of an advance without the prior approval of the Accountant General.”.

16. Amendment of regulation 68 of principal Regulations

Regulation 68 of the principal Regulations is amended by substituting for sub­regulation (1) the following—

“(1) All advances, other than those for Standing or Temporary imprests and those in respect of staff advances shall be secured by legally enforceable agreements in a form approved by the Attorney General.”.

17. Amendment of regulation 70 of principal Regulations

Regulation 70 of the principal Regulations is amended by—

1. substituting for sub-regulation (3) the following—

“(3) All costs, charges and expenses incurred in connection with negotiating, placing, managing, servicing or converting any investment made in accordance with these Regulations shall be paid out of the voted expenditure.”; and

2. deleting sub-regulation (4).

18. Amendment of regulation 75 of principal Regulations

Regulation 75 of the principal Regulations is amended by—

1. renumbering the existing regulation as sub-regulation (1); and
2. adding a new sub-regulation (2) to read as follows—

“(2) The Accountant General shall prescribe the format and manner in which such books of account shall be maintained.”.

19. Revocation of sub-regulation (9) of regulation 82 of principal Regulations

Sub-regulation (9) of regulation 82 of the principal Regulations is revoked.

20. Insertion of new Part XXII

The principal Regulations are amended by inserting immediately after regulation 106 the following—

“Part XXIIA—Control of Expenditure from Donor Funds.

106A. Authority to incur expenditure.

(1) All expenditure incurred by the Government on donor-funded projects shall be appropriated by Parliament by an Appropriation Act or a Supplementary Appropriation Act for the applicable financial year, and listed in the approved estimates of revenue and expenditures for that financial year.

2. In accordance with sections 12, 13 and 14 of the Act, a grant of credit, the Minister’s warrant and an accounting warrant shall be issued for any expenditure to be incurred from donor funds on a donor-funded project.
3. Except for those projects dealing with humanitarian emergencies, estimates of expenditure of a donor funded project shall not be considered or approved by the Minister to be included in an Appropriation Bill or a Supplementary Appropriation Bill unless proper costings and appraisals have been carried out by the concerned Accounting Officer.

106B. Operation of bank accounts.

The operation of bank accounts of a donor-funded project shall be in accordance with regulation 82.

106C. Preparation and reporting of accounts of donor-funded projects.

Preparation and reporting of accounts of donor-funded projects shall be in accordance with instructions issued by the Accountant General.”.

MWESIGWA-RUKUTANA, Minister of State for Finance, Planning and Economic Development (General Duties) Also Holding the Portfolio of Minister of Finance, Planning and Economic Development.