Kagadi Leaders Turn To Moneylenders As Govt Delays Funds For Four Months

Leaders of Kagadi Town Council in Kagadi District have raised alarm over a four-month delay in the remittance of funds from the central government, a situation they say has crippled service delivery and left them with no choice but to borrow from moneylenders.

The town council last received funds in December 2024. Since then, collections made in January, February, March, and April have been sent to the central treasury, but no allocations have been released back to facilitate operations at the local level.

In 2022, the government centralised revenue collection, requiring all locally collected funds to be channelled through the central treasury before being allocated back to lower local governments.

While leaders initially welcomed the move as a way to enhance transparency, Kagadi officials now say continued delays have instead paralysed essential services.

Kagadi Town Clerk John Isingoma said the town council collects about Shs40 million per month but has not received any remittances for the past four months.

"We appeal for support. We last received money in December. We collected for January, February, March and now April, but we have not got any money," Isingoma said.

He added that most service providers, including garbage collectors and fuel suppliers, have halted operations due to accumulated arrears.

"They claim that they have been patient enough," he said, warning that the situation is deteriorating.

Kagadi Mayor Geoffrey Businge said the financial strain has forced the council to seek loans from moneylenders, despite the burden of high interest rates.

"We have no way out. People abuse us for failing to deliver services, so we had to opt for money lenders," Businge said.

He also revealed that many councillors have boycotted council meetings because of unpaid allowances, further paralysing administrative functions.

The leaders urged the Ministry of Finance to expedite the release of funds to lower local governments, warning that the current crisis is not only disrupting services but also putting immense financial and emotional pressure on local officials.

The town council last received funds in December 2024. Since then, collections made in January, February, March, and April have been sent to the central treasury, but no allocations have been released back to facilitate operations at the local level.