Twaweza.org

Spending more than we earn; knowing less than we did: the Budget in Tanzania

Rose Aiko: Research Analyst-Uwazi

16.03.2010

Tanzanians care more about the budget and the use of public money, especially in the wake of a faltering war against corruption, allegations of abuse of public office, and the need to make our tax monies more effective. But when one reads the Budget Guidelines and observes how they have changed in the last couple of years, one wonders where we are headed, and whether we now know less.

In February, 2010 the Parliament endorsed, as a tradition, the Guidelines for Preparation of Medium Term Plan and Budget framework for 2010/11-2012/13. In the Guidelines, the Government has signalled its intentions and priorities over the medium term. We know for instance that the Government will spend approximately Tshs 10.4 trillion in 2010/11; that our taxes can only cover about half of it (Tshs 5.4 trillion); and that because of that our Government will have to borrow more unless donors suddenly become more generous and increase grants to Tanzania (unlikely).

In the meantime, the Tanzania Revenue Authority (TRA) is implementing its third Corporate Plan (2008/09-2012/13) and has committed itself to raise 6.2 trillion shillings for the 2010/11 budget. This figure is certainly higher than what the Ministry of Finance and Economic Affairs expects in tax revenues next year. But even if TRA was able to collect that amount, it would still not have been able to cover the Tshs 7.3 trillion projected in recurrent expenditures. This signals that something is not right on the expenditure side—the outgo (expenditure) is blowing up much faster than we are able to raise revenues.

Or is this inevitable in an election year budget? And we haven't discussed what President Kikwete acknowledged recently, namely that as much as 30 percent of the public money is disappearing into the pockets of unscrupulous civil servants and their allies. Or the reports of the Controller and Auditor General (CAG) that consistently show poor management. Or those of the Public Procurement Regulatory Authority (PPRA) that show billions spent in ways that do not quite represent best value for money. Spending public money is what governments do; but is Tanzania government doing it in the best way?

We also know that priority areas over the medium term will include the so called ‘growth sectors’: Agriculture, Infrastructure and Communication, Energy, Land Management, and Manufacturing. First step in the budget process accomplished, and institutions are expected to plan how they will spend our tax money next fiscal year. But hold on! Compared to the past, it is no longer possible to tell from the Guidelines what institutional expenditure ceilings are for the coming fiscal year. See the tables below for the kind of ‘budget ceiling’ information the Guidelines used to present:

Source:Guidelines for Preparation of Medium Term Plan and Budget Framework for 2006/07-2008/09

The last time this kind of information was provided in the Guidelines was in 2006/07, but since 2007/08 it is nowhere to be seen. What this means is that we cannot tell how much money in the upcoming budget for 2010/11 and over the medium term is likely to be allocated to individual Ministries, Department and Executive Agencies of the Government (MDAs); or to the regional administration or local government authorities. Information about the 10.4 trillion shillings is definitely useful. But to understand where we are heading, we also need to know how this money will be spent. We used to get know that, now we don’t.

Is budget accountability possible with such limited budget information? Can we expect to see institutional budget ceilings, which will be respected, in the Plan and Budget Guidelines in the future? Or is this window of information closed? With all the talk of more transparency and accountability, that would be a cruel irony indeed!

Read more: budget medium term plan Tanzania

You might also like...

 

Translate