KIA management set to be vested to TAA

THE government will table a bill in the National Assembly in September, which will seek to keep management of all airports under the Tanzania Airports Authority (TAA).

The announcement was made in the National Assembly on Wednesday by the Deputy Minister for Works and Transport, Mr Atupele Mwakibete, when responding to a question by Mwanaisha Ulenge (Special Seats-CCM).

In her main question, Ms Ulenge said last year the House resolved that the operations of the Kilimanjaro International Airport (KIA) be under the Tanzania Airport Authority (TAA), instead of Kilimanjaro Airports Development Company (KADCO), thus wanted to know the status.

The House also directed that the Controller and Auditor General (CAG) should do a comprehensive audit on the KADCO’s accounts from 2010 and bring the report to the National Assembly.

Responding, the deputy minister said after the Bunge resolution, the ministry prepared the amendment draft that TAA should be handed over the managements of airports, saying the document is currently at the Permanent Secretaries level after approval by the Attorney General (AG).

“The draft will be submitted to the Cabinet in its July seating and plans are to table the bill in the House to that effect in September this year, whereas management of all airports will be vested to TAA” he said.

“At present, there are airstrips which are under the Tanzania National Parks (TANAPA) and others are under various government institutions. The new bill will put managements of all government airports under TAA.

In her supplementary question, Ms Ulenge wanted to know when TAA will be allowed to collect passengers’ services fee in airports.

Responding further, Mr Mwakibete the government has made arrangement to collect the fees directly from the landing and other services.

Last year, the Speaker of the Parliament Dr Tulia Ackson tasked the government to come up with an explanation to clarify the ownership of the Kilimanjaro Airports Development Company (KADCO).

The Speaker told Minister for Works and Transport, Prof Makame Mbarawa, to clarify the matter before the House after the Public Accounts Parliamentary Committee (PAC) raised concern over ownership of the KADCO, as inquired by the 2020/21 report of the Controller and Auditor General (CAG).

When presenting its report before the August House, the PAC said it has identified shortcomings in the ownership of the KADCO.

It was the concern that the KADCO is now a public entity but there is 25-year concession agreement between the government and the KADCO. The contract started in 1998 and is set to end in 2023.

Initially, the KADCO was registered under the companies Act in 1998 as a private company under the ownership of two companies of Mott MacDonald International Limited which had 99 per cent of shares and Inter Consult Limited with 1 per cent shares.

But then the KADCO and the government entered into shareholder agreement in the same year of 1998 whereby the government owned 24 per cent shares and the remaining shareholders namely Mott MacDonald International (41.4 per cent), South Africa Infrastructure Fund- SAIF (30 per cent) and Inter Consult (T) Limited (4.6 per cent).

In November 1998 the government signed a concession agreement with the KADCO. The agreement gave the KADCO the right to develop the Kilimanjaro International Airport (KIA) for a period of 25 years.

But, in 2006 the government found some challenges, including that its fellow stakeholders failed to invest in developing the infrastructures of the KIA and the government was not benefiting because the KADCO was not paying concession fees.

Hence, in 2009 the government decided to buy all shares of the KADCO, thus enabling it to become the owner by 100 per cent.

The committee, therefore, was inquiring over the illegibility and reasons for the current existence of the concession agreement which is expected to end in July 2023.

The committee further sought an explanation over reasons as to why KADCO is not run by the Tanzania Airport Authority (TAA).

Dr Ackson asked if the government had already paid other shareholders to become sole owner of the KADCO, which agreement is now talked about.

“If the previous KADCO was no longer there why then there is still a concession agreement between the KADCO and the government,” she further inquired.

Responding Prof Mbarawa said the KADCO pays service levy to Hai District Council, and also pays dividends to the government.

He promised that plans were ongoing to make the KADCO operates under the TAA, but it would be upon amending the law because currently, the two entities run under different laws.

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