This archive report was first published on 6 July 2019.
Published on July 6, 2019, the East African Community (EAC) is facing significant funding shortfalls, forcing the Secretariat to draw funds from the gratuity fund to pay staff salaries for June.
According to a well-placed source in Arusha, the EAC's poor funding state has been exacerbated by low budget support from partner states, which has stalled several programmes.
Some staff members are reportedly fueling official vehicles out of their own pockets due to the lack of sufficient funding.
The EAC is approximately $100 million in arrears for the 2018/19 fiscal year, with outstanding debt from partner states being a major contributor to this shortfall.
Despite the challenges, a member of staff who spoke to The EastAfrican noted that salary payments were made on June 28, albeit a day late.
The EAC's Secretary General, Liberat Mfumukeko, had sought permission from the Council of Ministers to draw funds from the gratuity fund, which was subsequently sanctioned.
During the debate on the 2019/20 budget at the East African Legislative Assembly (EALA), members highlighted the difficulties faced by the Community's organs and institutions, citing the House's struggles to pay salaries and other lawmakers' dues on time.
Contributions from partner states have been declining year on year, with the last significant contribution being in the 2014/15 fiscal year, when they contributed $24,690,625, over 90% of the budget.
Even if partner states meet their quotas, a large chunk of the funds goes towards salaries and staff perks, with EALA itself spending 43.8% of its allocation on emoluments.
MP Rose Akol from Uganda noted that EALA was underperforming partly due to staff shortages, blamed on the lack of a mandate to recruit.
The hiring of staff and renewal of contracts for about 60 short-term staffers has been put on hold, with the contracts not being renewed on July 1 as expected.
South Sudan and Burundi have been the main defaulters of contributions to the bloc, while Kenya and Tanzania, who are the best performers in remittances, have lately slowed down their payments in protest.
Kenya and Tanzania's decision to slow down payments has led to a situation where some activities of the EAC organs and institutions are likely to stall or slow down.
For instance, the meeting of the Sectoral Council on Political Affairs, which was set for Nairobi in the last week of June, failed to take place and has been pushed to August.
There is hope, however, after EALA passed the EAC budget of $111.4 million for the 2019/20 financial year.
