Mobile survey reveals Ugandan unease over income inequalities

March 21, 2019 in Finance, Policy by Editor

Four out of five Ugandan households say their income does not meet daily expenses, but low inflation has kept prices in check.

March 21—Three out of four Ugandans are unhappy with the country’s economic direction.

A high-frequency mobile phone survey may not rank high in the government’s view as a fair assessment of its economic policies, but some of the findings make for interesting if not surprising reading. People continue to wonder when will impressive GDP figures translate into more jobs and fat wallets.

Twaweza, a regional civil society organization, has published its 2018 findings in a brief titled, More food, less money: Ugandans’ experiences and opinions on poverty and livelihoods. Sauti za Wananchi carried out the survey.

Marie Nanyanzi, the Sauti za Wananchi Programme Director at Twaweza Uganda said today, “This data tells a story of economic hardships for an expanding majority of Ugandans citizens. Although they there is a slight decrease in the dissatisfaction levels from 2017, many Ugandans still do not have enough income to meet their daily expenses.”

The findings are based on data collected from 1,905 respondents across Uganda during November 2018. When asked about the most serious issue facing the country and their household in particular, poverty came out top.

This figure has doubled from 14 pc in 2017 to 29 pc in 2018. Yet only a couple of days ago, President Yoweri Museveni was telling a National Resistance Movement retreat, “The people below the poverty line in 1986 were above 56 pc.  The people below the poverty line today are 21.4 pc.”

He told ruling party members, “However, some of the causes for the fall of poverty figures are on account of Government action by spending on education, health, water, etc.  If the whole population had taken advantage of these Government efforts and responded to the call to join the money sector, the poverty figures would be much better.”

According to the Twaweza brief, lack of employment is the third most named problem, twice as many people felt so in 2018 (12 pc) compared to 2017 (six percent).

On the other hand, fewer citizens are concerned about public services, like health, education and water, and more are worried about poverty and economic issues. Additionally at household level, half of Ugandans are troubled by the widening gap between rich and poor.

Four out of five Ugandan households (81%) say their household income does not meet daily expenses. These figures are similar to 2017. However, the amount of money that households report needing every day has gone down from UGX 11,800 ($3.20) to UGX 10,300 ($2.80) in the same period.  This can best be explained by the low inflation figures that characterised much of 2018.

Half of all Ugandan households have a member who has been forced to drop out of school for financial reasons. Two out of ten households (22 pc) have had a member die due to lack of financial resources for medical expenses. One out of ten households (12 pc) reports that the main breadwinner has lost their job in the last two years.

Many are also unhappy about employment (67 pc) as well as the state of corruption (70 pc).  Although there has been a notable reduction in food stress at the household level in 2018: citizens are less likely to report not eating for a whole day (37 pc compared to 49 pc in 2017).  Also the fact of running out of food because of a lack of money (69 pc compared to 53 pc in 2017).

However, more rural and poor Ugandans suffer from food stress than their wealthier and urban compatriots. Even so, one out of four wealthier Ugandans (25%) went without eating for a day in the past three months.

When households face financial difficulties, they try first to cut spending (37% report doing this). This number has increased from 2017 when 20% of Ugandans used this as a way to deal with financial difficulties. Far fewer Ugandans ask friends and family for help in 2018 (4%) compared to 2017 (15%).

However, when they face an emergency, most Ugandans (51 pc) still turn to family and friends for help, although the share of people saying they do this has decreased since 2017 (67 pc). More citizens are now likely to say they will sell something (up to 18 pc from 11 pc) or take a loan or overdraft (17 pc, compared to eight percent in 2017).

If given a cash injection of UGX 350,000 ($95) from the government, on average Ugandans are likely to spend close to half of it (44 pc) on starting or growing a business, 18 pc on agriculture and 13 pc on school fees.

Founded in 2009, by Tanzanian national, Rakesh Rajani, Twaweza sticks to five key values and principles to guide our work: effectiveness and accountability; transparency and communication; ethical integrity; reflection and learning; and responsibility and initiative.