MISUSE OF PUBLIC FUNDS DRYING UP GOVERNMENT COFFERS 

 

 

PRESIDENT Jakaya Kikwete has set an ambitious target for the state to collect monthly revenues amounting to 500bn/- amid growing concern that a large part of the government's resources are being squandered through corruption and misuse of public funds.

 

Already, the government has announced it will pay Dowans Holdings SA/Dowans Tanzania Limited some $65 million (nearly 100 billion shillings) under highly controversial circumstances.

 

Independent legal experts have argued that the High Court of Tanzania has powers to set aside a dubious ruling by the International Court of Arbitration (ICC) that awarded the payment to Dowans.

 

But top government officials are surprisingly in a hurry to pay the staggering amount of money to Dowans despite sufficient grounds for a recourse through its own court system.

 

Kikwete said the latest target set for the Tanzania Revenue Authority (TRA) is part of bold, new plans to strengthen government finances during 2011.

 

"We would like to see ourselves going beyond 500bn/- a month from the current 453bn/- a month," Kikwete said at the New Year sherry party he hosted for diplomats at State House on Friday night.

 

"We will give special attention to strengthening revenue collection and observance of public expenditure discipline.”

 

Kikwete said his government would identify key areas of weakness in revenue collection and strengthen them.  

 

"We will also continue with measures to broaden our tax base. With regard to financial discipline, we will ensure that departmental expenditure committees function accordingly," he said.

 

Kikwete also pledged to strengthen internal audit offices in ministries and government departments.  

 

"We will continue to facilitate further the office of the Controller and Auditor General (CAG). We will also sort out some of the outstanding issues with the office of the Accountant General," he said.

 

"I believe, if these measures are successfully implemented, we will achieve greater improvement in the management of government finances."

 

Billions of shillings are being lost from the government each month through graft, theft, a lack of financial discipline and general misuse of funds.

 

The government has itself been much criticised for continuing to squander taxpayers' money on luxury 4x4 vehicles, frequent first-class trips abroad and dubious allowances.

 

For example, in the government's 2009/10 budget, a staggering 19 billion/- was set aside for tea, biscuits and buns for government ministries.

 

According to latest Bank of Tanzania (BoT) figures, government revenue collections amounted to 502.5 billion/- in September 2010, out of which 479.5bn/- was tax revenue and 23.1bn/- was non-tax revenue.

 

On the other hand, total government expenditure during the month amounted to a whopping 917.9 billion/-, of which recurrent expenditure was 697.7bn/- and development expenditure was just 220.2bn/-.

 

President Kikwete has himself admitted that a third of the government's annual budget is stolen through bribery and corruption.

 

Tanzania’s national budget is currently estimated at $8 billion. This means that more than $2.5 billion is lost each year through large-scale graft.

 

It remains to be seen if the government's plans to strengthen it's finances will succeed in plugging loopholes for massive embezzlement of public funds.