A NEW directive abolishing retention of funds in public institutions will not cover local government authorities and social security funds, the government said yesterday in the National Assembly.
The Minister of State in the President’s
Office (Regional Administration and Local Government), Mr George
Simbachawene, clarified that the directive which was contained in a
speech by Finance and Planning Minister, Dr Philip Mpango had been
retracted through an erratum.
“Public institutions to be covered are
parastatals which are fully owned by the government and it will not
affect local councils and pension funds,” he explained.
The original speech by the finance
minister on the guidelines for 2016/17 development plan and budget
contained a part that abolished retention by all public institutions,
including local governments.
A number of MPs debating development
proposals took issue with the move by the government to shelve retention
of funds in local government authorities, arguing that the decision
will cripple councils.
Babati Urban MP, Ms Pauline Gekul
(Chadema), and Kigoma North MP, Mr Peter Serukamba (CCM), opposed the
move by the government to abolish retention of funds, arguing that the
decision will cause bureaucracy and cripple performance of public
institutions.
Ms Gekul argued that the shelving of
retention will lower morale in revenue collections at local councils,
stressing on the other hand that decentralization was introduced to
bring services closer to the people.
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