THE Controller and Auditor General (CAG), Professor Mussa Assad, has unveiled his maiden annual report that reveals soaring of national debt and massive misappropriation of public funds in various authorities and other government bodies.
Addressing a news conference shortly
after tabling the report in Parliament, Prof Assad noted that as of June
30, 2015, the National Debt stood at 33.5 trillion/-, out of which
8tri/- was an internal debt while the external debt was 25.6tri/-. This,
according to the CAG is an increment of 7tri/- (27 per cent), compared
to 26.5tri/- during the corresponding period in 2014.
On public authorities and bodies, the
CAG report revealed missing vessels in the revenue system at Tanzania
Ports Authority (TPA). “The audit of revenue at TPA revealed that out of
1,253 vessels docked at the Dar es Salaam Port during the year, 145
vessels were missing in the revenue system.”
“(Though the management was able to
provide information and supporting documentation for 60 vessels but
there was no supporting documentation for the remaining 85 vessels,
which were missing from the revenue system,’’ he said, adding that there
was a risk that revenue from the vessels could be misappropriated.
According to the report, there was also a
deficiency in the contract between Tanzania Internal Container Terminal
Services Limited (TICTS) and TPA.
The report further revealed that Usafiri
Dar es Salaam (UDA) Board of Directors sold the un-allotted shares in
UDA without government approval. “The Board of Directors gave a 60pc
discount on the value of the shares to the prospective investor without
any clear basis.
According to the CAG, the board chairman
admitted receiving 320m/- in his personal account from Simon Group
Limited as consultation fee for the services he claimed to have provided
to the investor which raises a serious conflict of interest.
“Since the sale of un-allotted shares of
UDA is not recognised by the government, the government should seize
control of UDA but also refund the part considered received by UDA,’’ he
added.
UDA’s shares were sold to Simon Group
Limited at 1.1bn/-, but the company paid only 24.9pc of the agreed sale
price (285m/). According to the report, there was no evidence for
payment of the remaining 75.1pc (858m/-).
At Tanzania Electric Supply Company
Limited (TANESCO), the CAG revealed that the company was yet to register
any net profit and that it has been incurring losses due to cost of
production being higher compared to the selling price for electricity
produced by Independent Power Producers (IPPs) and Emergency Power
Producers (EPP).
At Tanzania Investment Centre (TIC), the
report noted that the centre had ineffective Monitoring and Evaluation
System, lack of data integration between TIC and TRA, non-submission of
investor’s reports and returns and lack of awareness by investors on
activities of the centre.
The report also revealed un-inspected
consignments of food products of 4.6 bn/- at Tanzania Food and Drugs
Authority (TFDA). The consignment was imported in the country in the
financial year 2014/2015 without being inspected.
“This was highly contributed by the
products sneaking into the domestic market without verification of
quality and safety of the products through unauthorised entry points.
The CAG further revealed overpayment of salaries to the Institute of
Finance Management (IFM) by the Treasury amounting to 206m/- and that no
refund of the same has been made by IFM to the Treasury.
Furthermore, the report revealed that a
consignment of medicine amounting to 2bn/- according to records at the
Medical Stores Department (MSD) was still on transit from MSD
headquarters to Muhimbili National Hospital (MNH) since May 2013.
The report further unravels weaknesses
in public finance management both in the Central and Local Government
authorities. On payments to ghost workers on central government payroll,
the CAG report found out that they increased from 141m/- in 2013/14 to
393m/- in 2014/15.
On the same note, 61m/- was disbursed by
the central government as part of statutory deductions from ghost
workers. In the local government, 2.7bn/- was disbursed to 74 district
councils for payment of salaries to workers who never existed while
721m/- was also disbursed as part of statutory deductions.
The audit also found out that 2bn/- that
was not paid to workers were yet to be refunded to the treasury. Yet in
another finding, 707m/- deducted from employees’ salaries as statutory
deductions in Kilimanjaro and Katavi regions was yet to be paid to
pension funds and National Health Insurance Fund (NHIF).
On political parties receiving
subventions from the Office of the Registrar of Political Parties, only
CUF submitted its audit report while the remaining 21 registered
political parties were yet to meet the requirement of the law.
CAG said in the financial year ending
June 30, 2015, his office audited 199 Central Government entities, 164
Local Government Authorities (LGAs) and 102 Public Authorities.
According to him, out of 199 entities
audited during the year, 80 (90 per cent) were issued with qualified
opinions, while 18 (9 per cent) entities received unqualified opinion.
Also, one entity (Mzinga Corporation) was issued with adverse opinion.
“The government should widen its tax
base and create awareness on the importance of paying tax as well as
reducing its borrowing trend,’’ he added.
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