Kampala – Former Makerere University Chancellor and former Finance Minister, Dr. Ezra Suruma, has criticized the government’s decision to integrate the Uganda Coffee Development Authority (UCDA) into the Ministry of Agriculture, comparing it to making Mulago hospital a department in the Ministry of Health.
Dr. Suruma, a key figure in Uganda’s financial reform era, said that the decision undermines decades of dedicated coffee sector growth and called for a referendum for the coffee-growing populace to decide on the fate of their crop.
“The low quality of service delivery in many government departments deserves improvement, not additional work. Throwing away institutions like paper towels is so very difficult to understand”, said Dr. Suruma in a widely publicized statement.
Dr. Suruma outlined how the UCDA was established in 1990 as a self-sustaining entity with its own revenue stream, generated through a minimal “cess” — a service charge on coffee exports. Originally set at 1%, this charge funded UCDA’s operations independently of government coffers.
He however explained that the decision to increase the cess to 2% at a time of rapid coffee production growth led to a revenue surplus that soon attracted government interest.
“The Ministry of Finance decided to take all the cess and UCDA became another agency needing money from the government,” he noted, describing it as a “fatal mistake” that ultimately led to the authority’s dissolution as an autonomous agency.
Compairing the UCDA absorption with his experience during the privatization of Uganda’s banks in the late 1980s, Dr. Suruma expressed skepticism about the government’s stated intentions.
“Now the government has taken over those revenues and decided to make UCDA another department in the Ministry of agriculture. This reminds me of privatization. In 1987, the foreign supporters of privatization recommended that we either dissolve or sell all government banks. They said our banks were unprofitable and insolvent (bankrupt),” said Suruma.
“I fought to restore Uganda Commercial Bank to profitability until we turned it around and returned it to profitability as it had always been since 1965 when it was created. When we succeeded in making it profitable the neocolonialists said it would now get a better price. So You can see that I had not understood that the reasons they were giving for dissolving and privatizing our banks were deliberately misleading,” he emphasized.
Dr. Suruma further emphasized the necessity of a specialized, autonomous coffee authority to maintain and improve Uganda’s coffee quality, research, and export practices.
He pointed out that other major coffee-producing nations, such as Costa Rica and Colombia, maintain independent coffee authorities that provide focused expertise and streamlined services, which he fears may now be lost.
“For anyone who has engaged in coffee export in Uganda or knows anything about coffee exports, it is frightening to imagine exporters looking everywhere for absentee bureaucrats often scattered anywhere in a “department” in the ministry of agriculture,” said former Finance Minister.
“Ask people who tried to get phytosanitary certificates from the Ministry of Agriculture recently and how they fared. Ideally one wishes this matter could be put to a referendum so that the population can decide,” he added.
“The most efficient services come from specialized institutions whose knowledge and expertise takes many decades to learn and achieve. I can’t imagine, for example, making Mulago hospital a department in the ministry of health or Makerere a department in the Ministry of Education!”
The former minister further emphasized the necessity of a specialized, autonomous coffee authority to maintain and improve Uganda’s coffee quality, research, and export practices.
He pointed out that other major coffee-producing nations, such as Costa Rica and Colombia, maintain independent coffee authorities that provide focused expertise and streamlined services, which he fears may now be lost.
“For anyone who has engaged in coffee export in Uganda or knows anything about coffee exports, it is frightening to imagine exporters looking everywhere for absentee bureaucrats often scattered anywhere in a “department” in the ministry of agriculture,” said Suruma.
“Ask people who tried to get phytosanitary certificates from the Ministry of Agriculture recently and how they fared. Ideally one wishes this matter could be put to a referendum so that the population can decide,” he added.
“The most efficient services come from specialized institutions whose knowledge and expertise takes many decades to learn and achieve. I can’t imagine, for example, making Mulago hospital a department in the ministry of health or Makerere a department in the Ministry of Education!”
Dr. Suruma’s remarks contrast President Museveni’s argument that UCDA should be dissolved to cut on government expenditure and promote efficiency.
Museveni argued that UCDA was “irrationally hijacking the Government role of taxing by collecting what they call cess… By 1985, the Government budget was 26% from the coffee tax. We abolished it. Now the UCDA and its backers have brought it back. This could be the source of the venom,” said Museveni in a recent statement.
“We are removing irrationally got Government taxes from them. They have invited us to study this money more. Obviously, they are working with and for coffee exporters who do not want to hear about the NRM muziro (taboo) of continuing to export unprocessed raw- materials,” he added.
“The coffee exporters who give us USD 2.5 per kg for very good screen 18 coffee but end up getting USD 20- 40, do not mind kubegerako (give a portion) their local agents, UCDA, in the form of cess because they get much more from keeping Uganda as a raw- materials producer. A tax on raw materials to our factories, would not be correct. The cess is part of the whole distortion.”
