Budget procedure is faulty, says CAG

Mr Utouh center
Controller and Auditor General (CAG) Ludovick Utouh has highlighted what he sees as critical shortcomings in the national Budget system that renders it ridiculous, including the idea of a new Financial Year that takes effect before the Budget to which it relates has been endorsed.

He also criticised the practice in which debates on ministerial budgets are conducted after the endorsement, which necessitates unforeseen adjustments in due course.

Speaking at a press conference shortly after the latest pack of eight reports prepared by his office had been tabled in Parliament in Dar es Salaam in Dodoma yesterday,  Mr Utouh said the current system smacked of rubber-stamping, because whatever  adjustments are made, the reality is that the main Budget remains the same.

On timing, the CAG remarked: “Budget discussions start in June and end in August each year, while the annual cycle becomes applicable on July 1. This means that effective implementation of the budget starts in mid-September.”

He urged the government to dialogue with the Parliament on the possibility of readjusting the timing, under which budget-related  business should be completed before the start of a new financial year.

However, he noted that the issue would have to be tackled in a broader context through consultations amongst member states of the East African Community (EAC), which share a common Budget Day.

In their reactions, some economists commended the CAG’s observations as rational, but predicted that converting the proposals he had made into practice would be difficult.

A former University of Dar es Salaam lecturer, Dr Donath Olomi,  said it was possible to start with ministerial budgets and then switch to the national Budget, to reflect whatever changes that might have been made.

“The government can table a tentative main Budget that could be approved after amendments and approval of other budgets to reflect the changes. That is even more realistic,” he said.

Prof Ibrahim Lipumba, the National Chairman of the Civic United Front (CUF) who is also an eminent economist, concurred with Mr Utouh’s  proposal to alter the procedure, under which the main budget would represent a recap of ministerial  estimates.

He explained, however, that this would be difficult since Parliament does not prepare the Budget.

“The national Budget normally considers both revenues and expenditures. Even the amendments done on the budgets for specific ministries do not affect the main budget because the government adjusts it by reducing expenditures of a certain sector and increases that of another, which it deems deserves priority.

“After all the main Budget is prepared and agreed on earlier by the IMF before it’s tabled. So, other budgets do not change it. What is done is just adjustment by shifting allocations,” said Prof Lipumba.
Source: The Citizen,www.thecitizen.co.tz, reporting by Alawi Masare, Dar es Salaam and Peter Nyanje, Dodoma

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