THE Public Procurement Regulatory Authority (PPRA) has released its annual procurement audit report for the financial year 2015/2016, which has uncovered massive irregularities in the management of contracts by various Procurement Entities (PEs), occasioning losses to the government amounting to 23.4bn/-.
The Public Procurement watchdog carried
out procurement audits and verification audits in 70 PEs between April
and September, 2016, according to PPRA Board Chairman, Ambassador Matern
Lumbanga.
“Our audit established that the
government incurred losses totalling 23.41bn/- because of poor
management of contracts and 1.3bn/- was paid to contractors for
non-existent and shoddy works,” he said. Dr Lumbanga mentioned the
entities involved in the loss of this money as Rural Energy Agency,
Muhimbili Orthopaedic Institute (MOI), Dar es Salaam City Council and
the Local Authority Pensions Fund (LAPF).
Dr Lumbanga released the audit report at
a news conference in Dar es Salaam yesterday. According to him the
objective of the audits was to determine whether the procedures,
processes and documentation for procurement and contracting were in
accordance with the provisions of the law.
In addition, the audits sought to
determine whether contracts were being implemented in accordance with
stipulated contract terms and conditions and whether value for money was
achieved in spending public funds on selected construction contracts.
According to Dr Lumbanga, the total
number of audited procurement contracts was 21,313 with a total value of
1.05 trillion/-. PPRA reviewed 49 contracts amounting to 1.6trl/-
following 14 allegations of blatant disregard of the procurement law.
Dr Lumbanga said the review of contracts
was done to eight government institutions after receiving complaints
and information from whistle blowers. They are Tanzania Railway Limited
(TRL), Tanzania Civil Aviation Authority (TCAA) and National
Identification Authority (NIDA).
Others are the Ministry of Home Affairs,
Ministry of Health, Community Development, Gender, Children and Elders,
Ministry of Water and Irrigation, Tanzania Institute of Accountancy
(TIA) and Kondoa District Council.
PPRA also audited 122 revenue collection
contracts in nine Local Government Authorities (LGAs) and realised that
there was poor management of those contracts which led to the loss of
761.5m/-.
However, the report says, the
authorities did not take any measures as stipulated in the contracts
with the collectors. On the basis of the seven compliance indicators, of
all the 70 audited PEs, the outcome of the audits indicated an average
level of compliance of 71 per cent indicating a significant increase
above the last year’s average compliance level of 69 per cent.
However, the recorded compliance level
is below the targeted compliance level of 78 per cent which was set for
the Financial Year 2015/16. The analysis of the audit results indicates
that 22 out of 70 PEs were assessed to have satisfactory compliance
levels above the target of 78 per cent, while 10 PEs were assessed to
have unsatisfactory performance below the targeted level of
compliance.On corruption, Dr Lumbanga said for all audited procuring
entities, each audited project was tested with corruption red flags to
determine the likehood of corruption in each project.
“The entities which scored 20 per cent
and above on Redflags scale gave an indication that there is corruption
likelihood … however, it is important to note that a detected red-flag
is not in itself an evidence of corruption. The PPRA audit report
indicates that 20 projects that were being implemented by nine
government institutions had corruption indicators.
The entities which scored 20 per cent
and above on Red-flags Scale, thus giving an indication that there was a
likelihood of corruption include the Parliament of the United Republic
of Tanzania.
Others are Dar es Salaam City Council,
Rural Energy Agency (REA), Tanzania Communication Regulatory Authority
(TCRA), Dar es Salaam Rapid Transit (DART), Dodoma Municipal Council,
Sikonge District Council and the ministry of Water and Irrigation.
“The audit reports for all PEs and
specific projects with detected likelihood of corruption will be
submitted to the Prevention and Combatting of Corruption Bureau (PCCB)
for further investigation,’’ Dr Lumbanga said.
Following the anomalies, the PPRA Board
Chairman said Accounting Officers and heads of the PEs with poor
performance will be summoned to appear before the board to show cause
why disciplinary and legal action should not be recommended to the
competent authority.
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