Government has unveiled a five-year fiscal plan aimed at reducing the budget deficit, containing public debt and creating room for strategic investments and private-sector growth.
Finance Minister Henry Musasizi presented the Charter for Fiscal Responsibility (CFR) for the financial years 2026/27 to 2030/31 to the Parliamentary Committee on Budget, chaired by Amos Kankunda, on Wednesday.
The charter, which will guide government’s fiscal policy and budget decisions over the next five years, projects public debt to peak at 55.1 per cent of non-oil Gross Domestic Product (GDP) in 2027/28 before declining gradually to 50 per cent by 2030/31.
It also targets a reduction in the fiscal deficit, excluding oil revenue, from 6.6 per cent of non-oil GDP in 2026/27 to 1.5 per cent by 2030/31. Government also plans to reduce commercial borrowing relative to domestic non-oil revenue from 33.7 per cent to 19.3 per cent over the same period.
The new charter is the third since the fiscal responsibility framework was introduced and follows the expiry of the previous one at the end of the 2025/26 financial year.
The Finance Ministry said the targets are intended to maintain macroeconomic stability, ensure debt sustainability and create fiscal space for strategic public investments while supporting private-sector-led economic growth.
Minister of State for Planning Amos Lugoloobi said achieving the targets would largely depend on the performance of government projects.
“Macroeconomic indicators are ultimately influenced by how well public investments perform,” Lugoloobi said.
He said the ministry had placed project performance at the centre of the new fiscal period and was reviewing projects under the Integrated Bank of Projects individually to assess their progress and ensure they deliver the expected economic benefits.
The charter also seeks to reduce the burden of interest payments, which are projected to fall from 32.5 per cent of domestic non-oil revenue in 2026/27 to 20 per cent by 2030/31.
On petroleum revenues, the charter provides that a maximum of 0.8 per cent of the previous financial year’s non-oil GDP outturn in oil revenue will be transferred to the Consolidated Fund for budget operations. The remainder will be transferred to the Petroleum Revenue Investment Reserve, managed by the Bank of Uganda.
The fiscal objectives are aligned with the National Resistance Movement manifesto, the Fourth National Development Plan, the Ten-Fold Growth Strategy and the East African Monetary Union convergence criteria.
The charter was developed in consultation with key institutions, including the Bank of Uganda, Auditor General’s Office, Uganda Bureau of Statistics, Parliamentary Budget Office, Petroleum Authority of Uganda, National Planning Authority, Uganda Revenue Authority and civil society organisations.
Government says the overarching goal is to support socioeconomic transformation while maintaining macroeconomic stability, sustainable public debt and prudent management of petroleum resources.
