In 1997, the Ugandan government made the decision to provide free primary education for four children from every family. This is part of a strategy aimed at achieving universal primary education (UPE) in Uganda. Ambitious goals include the construction of thousands of classrooms, the provision of textbooks for all children, training and hiring of thousands of primary school teachers and providing them with professional support. Government spending on education has risen considerably to 30% of the budget. However there is still a lack of qualified teachers, textbooks and classrooms. 
The Netherlands embassy has been involved from the start in UPE. The representative of the Netherlands embassy, together with other stakeholders, is involved in policy dialogues at all key stages of the process. In this respect the policy of the Netherlands embassy is aimed at achieving the Millenium Development Goal nr. 2: (all children to achieve a full cycle of primary education by 2015). Until however a big percentage of pupils still does not complete the primary school cycle. The most important challenge for the future therefore is to ensure higher completion rates while at the same time keeping in view the challenges associated with the transition from primary to secondary school where currently, only 40 per cent of primary school leavers are absorbed. Other challenges are that the government retains education at the heart of its strategies to eradicate poverty and that budgeting and monitoring processes continue to improve. The embassy also funds a bursary scheme for the Northern Region in order to promote reconciliation and to ensure meaningful engagement of beneficiaries in development activities.

Also important to mention is that the government of Uganda has carried through a far-reaching process of decentralisation (the vehicle through which education services are delivered). Decision making powers, staff, and resources were transferred from the different national ministries to local councils. Local politicians are now accountable to the people who elected them. The general feeling is that local service delivery has been improved under the new system. In order to enhance the performance of local governments in implementing their constitutional and legal mandates for decentralised service provision one of the pillars of the Netherlands funded Local Government development Programme is the incentive system. This incentive system rewards good performance and sanctions poor performance. Poor performing local governments are supported through the capacity building grants. LGDP was based on the principles of participatory planning, involvement of all levels of LGs in the decision making and service provision, as well as the creation of ownership and sustainability of the investments. The Netherlands contributed US $ 5 million per annum to this national programme. In addition, the embassy also supported the fiscal decentralisation strategy of the Ugandan government. This strategy aims at streamlining and simplifying all central government transfers to local governments, but also at improving the tax collection system. In 2007 LGDP-I and II evolved into a Sector Budget Support Programme called Local Governement Sector Investment Plan (LGSIP). This Plan is the most comprehensive Local Government plan to date. The Netherlands together with some other donors support the LGSIP with 5 million € per year.