The government of Tanzania is so overwhelmed by debts that it has
experienced serious financial difficulties in the recent past, President Jakaya
Kikwete said yesterday. He did not give details, only pointing out that most
had been cleared.
Almost all government departments received less than their budgetary
allocations for the first half of the 2011/12 financial year, the President
declared in Dar es Salaam.
“The first six months of this financial year have been very tricky as
the government embarked on clearing its huge debts,” he said at a ceremony to
mark Law Day, “forcing the Treasury to disburse very little money to other
departments.”
But he was quick to pledge that the government will start honouring the
outstanding allocations promptly.
He was speaking in response to a statement issued by the Chief Justice,
Mr Mohamed Chande Othman, who said the judiciary had run out of money as the
government had failed to disburse its full allocation.
The CJ said the judiciary received only Sh6.32 billion between July and
December last year instead of Sh10 billion set aside for the institution for
the first half of the 2011/12 fiscal year. At least Sh20 billion was allocated
to the judiciary fund for the entire fiscal year.
“This budgetary constraint derails judicial activities and in turn,
affects provision of justice to the public,” said the CJ.
President Kikwete pledged that the government would ensure that the
judiciary received its due share of the budget in future. There have been
growing signs that state coffers are running dry, putting the government in an
awkward position as it battles to meet its financial obligations.
The liquidity problem has seen delays in payment of civil servants’
salaries, disbursement of subsidies to political parties and payments for a
wide range of services, including money meant for projects and the local
government.
Finance minister Mustafa Mkulo, who initially denied suggestions that
the government was broke, recently put the situation down to poor collection of
non-tax revenue and delays in the release of donor funds.
The state is said to have been grappling with a budget deficit of over
Sh210 billion in the past six months.
However, Shadow Finance minister Zitto Kabwe told The Citizen on
Saturday that the deficit peaked at over Sh600 billion and eased only when
donors released some funds. Local
revenue collection, which had been affected due to power rationing, also
improved.
In an official communication to the IMF, the minister made a commitment
to cut down on certain expenditure and review some of its projects to plug the
gap in the short term.
On Thursday, the minister for Regional Administration and Local
Government, Mr George Mukuchika, told Parliament that local authorities had
been greatly affected by lack of and delays in releasing the cash. The
situation was so bad, the minister revealed, that some services at the councils
had ground to a halt and some of them could not even hold meetings.
Source: The Citizen,www.thecitizen.co.tz, reported by Polycarp
Machira
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