Development budget deficit hits 60 per cent

Public Accounts Committee (PAC) acting chairman Gaudence Kayombo speaks to reporters in Dar es Salaam yesterday. Left is committee member Ester Matiko. PHOTO | VENANCE NESTORY 

By Sturmius Mtweve and Felix Lazaro ,The Citizen Reporters

In Summary

Mr Mbarouk noted that the government seems to be paralysed over what it should do to rescue the situation -- taking into account that it faces shortage of funds.

Dar es Salaam. A parliamentary committee yesterday confirmed the worst government budget expenditure news -- that up to 60 per cent of the money allocated for development projects under the local government has not been released with just weeks into the new budget.

The chairman of the parliamentary Local Authorities Accounts Committee (Laac), Mr Rajab Mbarouk Mohamed, said billions of shillings meant for community projects did not reach them owing to a big budget gap within government.

He was addressing journalists at the Bunge offices in Dar es Salaam yesterday after a closed door meeting of members to review documents on project implementation ahead of the next financial year’s Budget presentation in June.

He said there was a dismal budgetary performance in 2013/14 resulting from revenues collection shortfalls by the Tanzania Revenues Authority (TRA) and the declining donor assistance to the country.

Available statistics indicate that tax collection has gone down by 10 per cent while non-tax revenue has fallen by 30 per cent and donor money down by 25 per cent -- a situation which signifies difficult days ahead for the government.

According to Mr Mohamed, lack of funds has caused a delay in the disbursement of the funds from Treasury.

“Some 60 per cent of the budget allocated to local governments has not reached them – a situation which makes it difficult to implement various development programmes as scheduled,” he said.

Mr Mbarouk noted that the government seems to be paralysed over what it should do to rescue the situation -- taking into account that it faces shortage of funds.

This situation is despite reports that the state borrowed up to Sh850 billion from commercial sources to fund its operations.

The International Monetary Fund (IMF) has warned the government over its tendency of borrowing for recurrent expenditures and not for development programmes.

“You know, this year we cannot speak of any priority as we have been doing in the previous years, because, even if we keep prioritising, without funds, it doesn’t help,” noted Mr Mbarouk.

Meanwhile, the Parliamentary Public Accounts Committee (PAC) yesterday postponed receiving audit reports of some development projects over no-show government officials to respond to their enquiries.