'PDM beneficiaries need to stay longer with funds'

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The only way beneficiaries of the Parish Development Model (PDM) can expand their respective enterprises is to stay longer with the loans and avoid rushing to repay them.

Since beneficiaries are of small enterprises intending to transform them from subsistence farming into a money economy, they need to stay longer with the money and expand their projects other than rushing to repay.

According to PDM technical advisor Julius Kapwepwe, repayment guidelines stipulate two to three years, but some beneficiaries had started rushing to return the money within a year even when their businesses had not yet stabilised.

“There is evidence that these are small enterprises of the wananchi and we think they can be supported to stay a bit longer with the money and deploy it better and more profitably before returning it until they have expanded,” he said.

Repayment guidelines range between two to three years, but Kapwapwa noted that the degree of rushing to return couldn’t guarantee profitability and capital growth for the sustainability of their enterprises.

“When you expand your business and it matures beyond the establishment phase, it can care for itself and reach a level of stability,” he says.

Kapwapwa says President Yoweri Museveni deemed it necessary to review guidelines including that on repayment purposely to attain its intended goals.

“The President gave guidance on the period of returning the money of at least two to three years with everyone receiving shillings one million,” he said.

This was during the Local government regional budget consultative workshop for the financial year of 2024/2025 at Sunset Hotel in Jinja City on Friday.

Organised by the finance ministry (MoFPED), it was held under the theme: Full Monetisation of Uganda’s Economy Through Commercial Agriculture, Industrialisation, Expanding and Broadening Services, Digital Transformation, and Market Access.

The event was attended by chief administrative officers, heads of departments, politicians, and resident district commissioners drawn from six local governments in eastern Uganda.

They included Bugweri, Kibuku, Mbale city council, district Pallisa, Butaleja as well as Lugazi municipality.

However, Bugweri RDC Billy Mulindwa said they were still struggling with recovering the Emyooga funds because beneficiaries are reluctant to repay.

Much as guidelines stretch up to three years, Mulindwa said they had experience in Emyooga and were of the view of starting to repay the PDM funds within two years.

“I don’t want to look as if I'm fighting my government, but as RDCs, we struggle to pursue such beneficiaries because some end up shifting from one district to another and under this situation, we liaise with our counterparts to track them,” she said.

Mulindwa cited financial institutions like FINCA where its clients of soft loans return in two years.

In the budget process for the 2024/2025 Financial Year, the PDM has been prioritised among the key local government-specific policy and administrative issues.

According to Finance Minister Matia Kasaija, PDM is the vehicle for lifting 39% of the population from subsistence into the money economy through the stipulated seven pillars of which financial inclusion has taken the lead.

Kasaija, who was represented by Dr Fixon Akonya Okonye, the Internal Auditor General with MoFPED at the opening of the session, said shillings 2,324 billion had so far been provided under PDM since 2021/2022.

He said effective next financial year and beyond, the strategy would be strengthened to ensure all the seven pillars were congruently implemented by the respective ministries, departments, and agencies.

The minister said this would warrant the effective attainment of the intended goal of moving all people to a cash economy as raw materials producers by attracting industrialist to add value.

However, Kasaija said this would require effective implementation, monitoring, and evaluation of the program and implored participants to embrace their efforts toward its PDM implementation.