Politicians have raised concern that some agencies collect substantial sums of money but end up mismanaging their revenue while the state faces fiscal deficit.Currently, the respective boards of directors approve their budgets, which is not the proper way to manage public funds, said the Shadow Minister for Finance and Economic Affairs, Mr Zitto Kabwe.
“The appropriate way is for the budgets to be forwarded to the Treasury Registrar, then annexed to the respective ministry’s budget to be endorsed by parliament,” Mr Kabwe, who is also the Kigoma West MP, said.However, “It is totally wrong to direct agencies to remit all revenue to Treasury. This will increase bureaucracy. The best way is to control the expenditure of these agencies and parastatals,” he added.
The vocal MP said further that the agencies were established legally by Acts of parliament and it was just fair that their expenditure be scrutinized by the authority that created them.The Minister for Finance and Economic Affairs, Dr William Mgimwa, admitted that the government faced a number of challenges in efforts to control the expenditure state agencies as there was no law to that effect.
“It is true that we are facing such challenges. But the new draft law will address these issues in sufficient detail,” Dr Mgimwa said, playing down claims that the Treasury was the centre of inefficiency.The Minister said the new law will oversee the running of agencies and authorities and specifically on the role of revenue management, which comprises collection and expenditures.
“We are currently scripting the final draft after over 400 various stakeholders submitted their views on the matter. The law will be tabled and (possibly) passed in this fiscal year,” Mgimwa, a PhD holder in Finance, said.But renowned economist and lecturer, Dr Haji Semboja of the University of Dar es Salaam disagreed. “It is categorically wrong as such a move will send the economy into chaos as the government cannot run businesses,” he said.
According to the lecturer, doing so meant the Treasury had either failed to hold the agencies accountable or to instill a sense of integrity in them. Another economist, Dr Prosper Ngowi of Mzumbe University’s Dar es Salaam School, said, “I basically do not see the problem when these ministries, agencies and departments (MDAs) use the money they directly collect.
“If a good system of public financial management (PFM) is in place and I know it is there in many MDAs, I don’t see where the worry is coming from…if the PFM system is broken, then fix what is broken…(but) not running away from it!”
There are several executive agencies and regulatory authorities that are also answerable to various Parliamentary Committees. These agencies have the task to finance consumers’ consultative councils.
The agencies were formed to facilitate improved service delivery, cutting red tape and preventing their dependence on the central government, thereby fostering good governance. Their revenue is derived from fees and levies imposed on consumers.