TANZANIA: Probe new BoT `scam` – CAG

By Bilham Kimati

bank_of_tanzania.jpgTowers of the Bank of Tanzania
Questions over the Bank of Tanzania (BoT) expenditure keep surfacing with the latest report of the office of the Controller and Aud

CAG Ludovick Utouh unveiled the audit report for the financial year
ended June, 2008 at a press conference in Dodoma yesterday, detailing
fraudulent public procurement procedures, dubious agreements and
cheating on allowances causing massive loss of public funds.

Flanked by three parliamentary committee chairmen, Zitto Kabwe for
Public Organisations Accounts, John Cheyo for Public Accounts and Dr.
Wilbrod Slaa for Local Authority Accounts, Utouh said his office had
submitted the relevant BoT documents to the Prevention and Combating of
Corruption Bureau (PCCB), for thorough investigation.

"For example, the twin-tower construction agreement indicated that the
contractor has to pay both the public liability risk insurance and the
damage to property risk insurance.

"Strangely enough BoT also signed an agreement with an insurance agent and paid 7.3bn/- for a similar purpose.

"My office is questioning the procedure followed to arrive at the dubious double payment. PCCB are working on it, Utouh said.

Agreements on payments to the Quantity Surveyor were that the
consultants were to be paid according to the country`s Architects and
Quantity Surveyor Ordinance Bye- Laws 1950 as revised in 1972.

Yet the payments to Design and Service Limited Contractor amounting to 39.8bn/- were done contrary to the agreements.

The CAG also took issue with public funds issued by the Treasury to the
ministry of Health and Social Welfare for purchase of medicines to be
supplied to the district councils for local dispensaries.

Utouh said the money was given to the medical stores department (MSD),
leaving the targeted beneficiaries in total darkness as to their
allocations and creating loopholes for diversion of the funds or the
medicines by unscrupulous officials.

Due to laxity in various public offices, the report indicates that the
government`s unpaid local debts until last year amounted to 293bn/-.

This was in addition to several other leakages of public funds that ended in individual pockets.

The report further questioned the integrity of some entrusted
government officials who for example continue collecting salaries
previously paid to those retired, dead or fired for more than two

"Officials from some other public organizations paid per diem to its
officials travelling out of office yet covered accommodation that
amounted to millions of tax payers' money," he said.

Poor performance of some district councils also caught the attention of
the CAG`s office with the discovery that last year some 99bn/- in
general assessment was not spent for development projects at all.

To control uncalled-for spending of public funds CAG recommended a
close monitoring system at the BoT to avoid another scandal similar to
EPA. "Government officials should follow advice by the CAG office to
avoid such problems," he said.

"Lack of discipline in public expenditure remains a serious issue.
There should be consistency for example in the procurement of vehicles,
furniture and other entitlements for government officials.

"In doing so efforts made to increase internal revenue would pay off, Utouh suggested.

CAG Utouh said his office had no powers to prosecute those discovered
to have acted contrary to the regulations but suggested that the report
by his office should serve as a clue to the concerned authorities to
carry out thorough investigation to bring to justice all those
implicated in the dubious expenditures.

Responding to the highlights by CAG`s report, John Cheyo said all
officials spending public funds for personal gains have demonstrated
the highest level of disloyalty and deserved punishment.

"We (nation) cannot afford to continue begging while billions of
shillings meant for community development is spent carelessly.

"It is funny that sometimes documents needed for auditing were not found
at the appropriate time. Enough is enough of dubious agreements at the
expense of the nation, Cheyo said.

Dr. Slaa said time has come for the government to hire internal
auditors to exercise control over the funds allocated to district
councils to stop embezzlement. " don't think this is more costly than
the money spent dubiously," Dr. Slaa said.

For his part Zitto Kabwe suggested that a close monitoring of
government shares in different companies would give a clear picture on
the channeling of public funds and put a stop to dubious contracts.


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