Local authorities owe LGLB 6bn/-, face one-month ‘stay’

Minister of State, President’s Office (Public Service Management and Good Governance), Ms Angela Kairuki

ROSE ATHUMANI in Dodoma

In an appearance before the Local Authority Accounts Committee (LAAC), an official from the President’s Office - Local Government and Regional Administration, TAMISEMI, responsible for auditing and monitoring regional and district council funds, Mr Denis Bandija, said local authorities have been slow in paying back loans, making it difficult to issue loans to others.

Mr Bandija was responding to a statement raised by Kishapu Council in Shinyanga District, which noted that they are unable to complete construction of Mhunze Bus Stop because LGLB has not issued 150m/- remaining to complete the project, which is part of 800m /- loan from the local authorities’ financial institution.

He said the amount of fund still in the hands of local authorities has made it difficult for the financial institution to provide loans to needy councils, forcing the drastic measures to be taken to find a better system of issuing and refunding the loans.

He said TAMISEMI has formed a working team, which is tasked with providing recommendations on the best way loans can be issued and repaid that will ensure the LGLB receives monies directly from the local authorities.

Citing an example without going into specifics, Mr Bandija noted that the Mbeya District Council is among those that have outstanding loans despite owning a hall that has bookings all the way to January 2017 but still fails to pay back the loan.

He explained that previously, there was no proper system on how local authorities would pay back the loans, stressing that the working team will recommend the best system for paying the loans directly to LGLB.

“Once the team is through with its work after one month, we will have recommendation on the best system that will allow local authorities to pay the loans directly to LGLB. The financial institution then will resume issuing the remaining funds to the local authorities, including Kishapu District council,” he explained.

Earlier, when fielding questions to the Kishapu District Council team for the local authority’s 2014/15 accounts, Mr Issa Mangungu (Mbagala- CCM) wanted the district officials to explain the reasons behind incompletion of the Mhunze bus stop.

In his explanation before the local authority’s parliamentary committee, the district’s Project Engineer, Mr Samson Pamphili, said the project was implemented in two phases, noting that Phase One was completed while 90 per cent of the work in the Second Phase had been undertaken.

He noted, however, that the remaining part of the 800m/- loan from LGLB amounting to 150m/- had not been disbursed yet, causing the delay in completing the bus stop. Eng Phamphili explained that the LGLB has already issued 650m/- and the remaining 150m/- will see the completion of the project.

In its winding remarks LAAC directed TAMISEMI to speed up the new process of issuing loans to local authorities to avoid burdening them with accumulating interests on loans already received.

LAAC Acting Chairperson Mr Abdalla Chikota (Nanyamba- CCM) said TAMISEMI should also ensure the remaining loan of 150m/- to Kishapu District council is issued to see the completion of the bus stop project.