Tanzania - Public expenditure review - FY00 (Vol. 1 of 2) : Main report

Report No. 22078-TA The United Republic of Tanzania Public Expenditure Review FY00 (In Two Volumes) Volume I: Main Report January 2001 Government of Tanzania and The World Bank Macrocconomics 2, Africa Region FIL C L Yi GO VERNMENT FISCAL YEAR July 1 - June 30 (FY00 or 1999/00 = July 1, 1999 to June 30, 2000) CURRENCY EQUIVALENTS Currency Unit = Tanzanian Shilling (T Sh) Interbank Market mid-rate: US$1.00 = T Sh 8870 (April 16, 2001) ABBREVIATIONS AND ACRONYMS ADT average daily traffic NECTA National Examinations Council of AfDB African Development Bank AIDS Acquired Immune Deficiency Syndrome NBC National Bank of Commerce AITF Agricultural Inputs Trust Fund NGO non governmental organization ASYCUDA Computerized Customs Reporting and O&E organizational and efficiency (reviews) Recording System (UNCTAD) O&M operations and maintenance BEMP Basic Education Master Plan OC other charges BOP Balance of Payment OECD Organization for Economic Cooperation BOT Bank of Tanzania and Development CBMS Cash Budget Management Systems OUT Open University of Tanzania CG Consultative Group PAYE pay as you earn CSRP Civil Service Reform Programme PE personnel emoluments DANIDA Danish International Development PER Public Expenditure Review Agency PFP Policy Framework Paper DEO District Education Officer PHC Primary Health Care DMO District Medical Officer PSWB Public Sector Wage Bill DMT District, Municipal and Town Councils PTPR pupil teacher ratio ESAF Enhanced Structural Adjustment Facility REO Regional Engineer's Office ESP Education Sector Programme RPFB Rolling Plan and Forward Budget FAO Food and Agriculture Organization SAC Structural Adjustment Credit GDP gross domestic product SAL Structural Adjustment Lending GNP gross national product SGR Strategic Grain Reserve GOT Government of Tanzania SIP Sector Investment Program HIPC Highly Indebted Poor Countries Debt SPA Special Program of Assistance Initiative SSA Sub-Saharan Africa HIV Human Immuno-deficiencv Virus STD Sexually Transmitted Disease IDA International Development Association TAC Tanzania Audit Corporation IMF International Monetary Fund TANESCO Tanzania Electric Supply Company IRP Integrated Roads Project TAZARA Tanzania Zambia Harbours Authority MAC Ministry of Agriculture and Cooperatives TB Tuberculosis MANTEP Educational Management Training THA Tanzania Harbours Authority Institute TRA Tanzania Revenue Authority MOEC Ministry of Education and Culture TRC Tanzania Railways Corporation MOF Ministry of Finance TTC Teacher Training Colleges MOH Ministry of Health UDSM University of Dares Salaam MSTHE Ministry of Science, Teclmology and UNDP United Nations Development Program Higher Education UPE Universal Primary Education MTEF Medium TerN Expenditure Framework VAT Value Added Tax Vice Presidentn Callisto Madavo Director: James W. Adams Sector Manager: Frederick Kiob n Task Team Leader: Benno Ndulu CONTENTS 1. PER PROCESS FOR FY00................................................................................................................1... 1.1 AN OVERVIEW OF PER FY00 .......................................... ........1... 1.2 TECHNICAL STUDIES IN SUPPORT OF IMPROVED BUDGET MANAGEMENT..........................2 1.3 IMPLEMENTATION OF PER FY00........................................ .......4... 1.4 LESSONS AND PROSPECTUS OF WORK FOR PER FY01.................................5. 2. REVIEW OF FISCAL PERFORMANCE .......................................................................................9.. 2.1 INTRODUCTION ........9.... 2.2 AGGREGATE FISCAL DEVELOPMENTS........................................................ Domestic Revenue and Foreign Inflows....................... .....................9.. Government Expenditures..................................................... Deficit Financing..........................................................13.. Budget Implementation......................................................13. 2.3 SECTORAL ALLOCATIONS AND PRIORITIZATION............................................15 2.4 OPERATIONAL EFFICIENCY ...................................................... ........19. Public Sector Reform Program......................................... ........2D. Availability ofResources for Operations and Maintenance.................. ..........2.0 Predictability ofResource Availability.......................... ...............22 2.5. OPERATIONAL EFFICIENCY - FINDINGS OF THE COMPTROLLER AND AUDITOR GENERAL............26 Introduction. ............................................................26.. Main Findings............................................................27.. 2.6 ASSESSMENT OF INSTITUTIONS FOR IMPROVED BUDGET PERFORMANCE ........................29 2.7 ROAD FUND MANAGEMENT. . ............................................................34. Background... ..........................................................34.. Key Issues on Road Fund Management............................. ..............34 3. SYSTEM IC FISCAL ESUES ..........................................................................................................3 . 3.1 THE PLIGHT OF THE DEVELOPMENT BUDGET...... ........... .......................38 3.2 DESIRABLE LEVEL OF REVENUE MOBILIZATION. ............................... ............4.1 3.3 FISCAL RESTRAINT AND CASH BUDGET MANAGEMENT SYSTEM...............................43 3.4 MACROECONOMIC STABILITY AND DEBT SUSTAINABILITY..................................45 3.5 CO-EXISTENCE OF OVERALL FISCAL SURPLUS SIDE BY SIDE WITH UNDER-FUNDING OF PRIORITY SECTORS. ...................................................................................46... 3.6 CONCERN ON ABSORPTIVE CAPACITY CONSTRAINT WITH INCREASING RESOURCES ...................46 3.7 EARMARKING OF REVENUE AND THE EFFECTIVENESS OF BUDGET MANAGEMENT ... ...........47 3.8 PREDICTABILITY OF DONOR RESOURCES................................. ..............47 4. FISCAL POLICY AND THE MACROECONOMIC CONTEXT.........................................49 4.1 INTRODUCTION................................... ...........49. 4.2 LINKS BETWEEN PUBLIC AND PRIVATE ACTIVITIES..... ...................................50 4.3 RESOURCES LIKELY TO BE AVAILABLE TO THE GOVERNMENT, FY01 - FY03..... ...........51 4.4 THE GUIDELINES DOCUMENT..........................................................53. 4.5 ASPECTS OF DOMESTIC CREDIT..........................................................54. 4.6 FISCAL OPTIONS............... ........................................................56.. 47 CONCLUSION.................. ..........................................................58.. 5. EDUCATION SECTOR..................................................... 5.1 BASIC EDUCATION . ...................................................................................................................6 . 5.1.1. Scope of the PER FY00 .................. .....60 5.1.2 Recent Development&.................................................6. 5.1.3 Expenditure Trends.................................................61. 5.1.4 Performance Trends...............................................62. 5.1.5 Regional Variation..................................................63. 5.1.6 Budget and Expenditure Projections.......................................64 5.1.7 Next Steps..... ....................................................6.4. 5.2 HIGHER AND TECHNICAL EDUCATION........................ ............................66 5.2.1 Recent Developments and Education Policy Context...........................66 5.2.2 Sub-Sector Performance 1994-2000........................................6 5.2.3 Financing ofHigher Education..... ....................................68 5.2.4 Analysis ofEfficiency and Effectiveness ofHigher and Technical Education..................72 5.2.5 Review ofHigher and Technical Education Sub-Sector Expenditure ......................75 5.2.6 Policy Recommendations...............................................78 6. HEALTHSECTOR.......................................................sa. 6.1 INTRODUCTION..........................................................................6 Background................................................................ Health Sector Reforms ....................................................... 6.2 HEALTH POLICY OBJECTIVES ........ ........................................... .......... 6.3 STATUS OF THE HEALTH SYSTEM............................................................................... &L 6.4 PUBLIC ExPENDITURE PERFORMANCE .........................................................................82 Background ................................................................................................. 82.. Analysis ofExpenditure Trends in the Health Sector Hihr.n.e...................... .......................82 Sub-Sector Budget Allocations .............................................................................. 83. Analysis ofHealth Sector Funding Requirement Su-Sctrr................. e........... ..........84 Priority Areas ............................................................84.. Proposals for the FY01 Budget ..................I ........................................................... 86. 7. W ATERHSECTOR............................................................................................................................ K .. 7.1 INTRODUCTION............................................... ........................8 Water Sector PER Objectivesfor FY01..........................................8 PE Study Approach and Methodology............................. ...................87 7.2 ISSUES RELATED To BUDGET PERFORMANCE FOR FY98-FYOO.........................87 Total Budget...................... .......................................................................... 87.. Capital Budget Issues ......................................... ................... .........................817. Recurrent Budget Issues ...................................................................88. Budget Ceiling n.......................................... . ..........89.. Impact ofHExpenditure on Water Sector Development...................................89 7.3 INSTITUTIONAL FRAMEWORK AND CAPACITY BUILDING ...................................................91 Main Institutional Administrative Issues and ConcernsAr ................... . .........91 7.4 CURRENT STATUS OF WATER SECTOR PERFORMANCE.............................. ........91 Surface Water.......................................................91 Groundwater ............................................................. 92.. Rainfall .................................................................92.. Rural Water Supply.............................................. ..........92.. Urban Water Suppv and Sewerage................................................93. Irrigation................................................................94... vdropower Generation......................................................94. Conflicts in Water Uses......................................................95. 7.5 WATER SECTOR POLICY OBJECTIVES AND PRIORITIES FOR THE FY01 ..................95 The Developm ent and W ater Sector Vision......................................................................................... 95 Ministry of Water Mission and Water Sector Polic Objectives for FY.1................ .........96 Water Sector Prioritiesfor FY ........ ................................................9.6 Optionsfor iproving the Impact of the Budget on the ater Sector.....................9 Reforsot Well Captured in the Current Budgeting Is..................... ....97 Ongoing Resource Deployment Reform ..........................................98 Measures to Reduce Aid Dependency and Enhance Optimal Utilization ofResources..................98 Water Sector Budget Outlook for FY01 ............................. ..... .........98 8. ROADS SECTO R.............................................................................................................................I0 8.1 THE ROAD NETWORK IN TANZANIA.................10..............................1 8.2 GOVERNMENT VISION FOR THE ROADS DEVELOPMENT . ................................100 8.3 ROLE OF PARENT MINISTRIES.......................................... ..........101 8.4 THE ROAD FUND .............................................................101 8.5 THE "NEW" MOW AND TANROADS . ................................. .......102 8.6 MOW OVERALL EXPENDITURE PERFORMANCE FY98-FYO0. .................. .......102 8.7 MOW EXPENDITURE ON ROADS .................................................1.03 8.8 LOCAL AUTHORITIES EXPENDITURE ON ROADS ......................................104 8.9 DONOR COMMUNITY RESOURCES FOR ROADS .......................................105 8.10 RECOMMENDATIONS........ ................................................106 9. A GRICULTURE .............................................................................................................................10 S 9.1 OBJECTIVES OF THE FY01 AGRICULTURAL SECTOR PER...........................108 9.2 PERFORMANCE OF THE AGRICULTURAL SECTOR....................................108 9.3 BUDGET PERFORMANCE FY98-FYOO .............................. ...............110 9.4 CONSTRAINTS AND FUTURE PROSPECTS OF THE AGRICULTURE SECTOR........................................111 9.5 RESOURCES AVAILABLE TO THE AGRICULTURAL SECTOR ..............................1.12 9.6 PRIORITY AREAS FOR UTILIZING MEAGER RESOURCES ........................ ........113 9.7 POLICY RECOMMENDATIONS ........................................ ............113 10. JU STIC E............................................................................................................................................1 10.1 INTRODUCTION ............................................................115 10.2 VISION....................................................................115 10.3 MAJOR ISSUES .............................................................1.15 10.4 GOVERNMENT EXPENDITURE ON MJCA. ........................... .............116 10.5 ALLOCATIONS WITHIN THE MJCA.............. .................... ......117 10.6 ACTUAL RECURRENT EXPENDITURE BY DEPARTMENTS AND ZONES ............ ........117 10.7 RECOMMENDATIONS ........................................................120 ANNEXES: ANNEX 1: MINUTES OF CONSULTATIVE PER MEETING ANNEX 2: DATA TABLES: Table 2.1: Government Revenue and External Grants, FY95 - FY00............. ...................10 Table 2.2: Foreign Inflows - Grants and Loans, FY95 - FY00..............................11 Table 2.3: Government Expenditures, FY95 - FY99... .....................................1.1 Table 2.4: Civil Service Employment, FY97-FY99 (December of each year)........... ....................12 Table 2.5: Civil Service Average Salaries, FY97-FY99. ....................... .............1.2 Table 2.6: Financing of the Fiscal Deficit, FY95 - FY00................ ..................13 Table 2.7: Sources of Budget Shocks.................. ...................... ......14. Table 2.8: Sectoral Shares in Total Recurrent Expenditures - Actual........... ................15 Table 2.9: Sectoral Growth Rates of Recurrent Expenditures - Actual...........................16 Table 2.10: Sectoral Shares in Total Development Expenditures - Actual........... ................16 Table 2.11: Recurrent Expenditure in the Priority Sectors, 1997/99-FYOO.......... ..................18 Table 2.12: Change in Allocations and Exchequer Releases to Priority Sectors, FY00 (July-February).... 18 Table 2.13: Development Expenditure in the Priority Sectors (as % of total recurrent expenditure), 1997/98-FYO ....................................... ................... Table 2.14: Sectoral expenditures on OC and PE, FY99-FYOO ..............................21 Table 2.15: Key Institutional Arrangement and Expenditure Outcome&.. .........................29 Table 2.16: Revenue Collected by Treasury but not included in the Road Fund (Tsh. million) ..............35 Table 2.17: Road Fund (fuel levy) Collection, FY97 - FY00 (Tsh. Million). ........ ...........35 Table 3.1: Marginal Effective Tax Rate on Capital for Foreign Firms (Applying Uganda's Non-Tax Parameters to Kenya and Tanzania) ....................... .................42 Table 3.2: Marginal Effective Tax Rate Cost of Production for Foreign Firms (Applying Uganda's Non- Tax Parameters to Kenya and Tanzania)............................42 Table 4.1: Budget allocation as share of requirement for priority activities in various sectors (%)............53 Table 4.2: Financial variables in % of GDP........................................55 Table 5.1: Share of Actual Recurrent Budget Expenditure, 1992/93 - FY99...................61 Table 5.2: Performance Indicators in Primary Education ...............................62 Table 5.3: Performance Indicators in Secondary Education ................................63 Table 5.4: Performance Indicators in the Teacher Training Sub-Sector......................63 Table 5.5: Regional Variation on Selected Performance Indicators... ........ ........64 Table 5.6: Main Problem Areas and Suggested Remedies for Higher Education and Technical Development in Tanzania...................................................7.1. Table 5.7: Teacher-Student Ratios in Selected Higher and Technical Education... ........................73 Table 5.8: Proportion of Funds Allocated to Various Expenditure Items for Universities in Africa, Europe and UDSM....................................................74.. Table 5.9: Main Efficiency Problem Areas and Suggested Remedies for Higher and Technical Education in Tanzania ....................................................74.. Table 5.10: Trends in Higher and Technical Education Funding in Tanzania 1993-1999(%)...............75 Table 5.11: : Tanzania: Higher and Technical Education Expenditure By Purpose: 1993-1999 Percent of Sub-Vote Actual %)............. .............. 76.. Table 5.12: Trends in Government Development Expenditure in Higher and Technical .. ...........77 Table 5.13: Predictability of Resource Flows to Higher and Technical Education in Tanzania (%) 1994- 1999* ....... .................................................78 Table 6.1: Government Budgets and Actual Expenditures for Health Sector in Billion Tanzania Shillings. .......................................................83. Table 6.2: Sub-services/Functions Breakdown of Government Recurrent Budget for Health - FY99.......84 Table 6.3: Funds Requirements and Proposed Allocation of Funds for Priority and Activities in the Health Sector. (Millions of Tshs) ................... 85. Table 7.1: Projected Total Budget Outlook for FY01 - 2003/04 . ................... ........9.8 Table 7.2: Breakdown of Capital Budget Outlook for FY01 .................... .........99 Table 7.3: Breakdown of Recurrent Budget Outlook for FY01...........................99 Table 8.1: Road Network by Type Surface and Condition (in km)......................1.00 Table 8.2: Government allocation of resources to the road sector (in mill. Tsh.) ....... .............103 Table 8.3: Resources allocation for road maintenance and rehabilitation (mil. Tsh.) ...... .......104 Table 8.4: Road Fund collection and allocation to MOW and PMO/MRALG (in mill. Tsh.) ...................105 Table 8.5: Flow of resource form donors (in mil. Tsh.) ...............................105 Table 9.1: Agriculture GDP and Growth Rates (in constant 1992 prices) ....................108 Table 9.2: Cash Crops Production (in metric tons) ....................... ...........109 Table 9.3: Recurrent Budget for FY98-FYOO (Mil. Tsh) ...............................Ill Table 10.1: Actual Government Expenditure on MJCA, FY98 and FY99 (Million Tsh. and Percentages) ......................................................116. Table 10.2: Distribution of MJCA Expenditure by Departments (million Tshs) ............ .........117 Table 10.3: Actual Recurrent Expenditure in the Judiciary Department in terms of PE and OC (in percentage).......................................... .........118 Table 10.4: Development Expenditure on MCJA (TShs. Million and %) .............. ........119 PREFACE As in previous years, the FY00 Public Expenditure Review (PER) process had the twin objectives of (a) providing support to the Government of Tanzania in the preparation of its budget and Medium Term Expenditure Framework (MTEF) and (b) undertaking an external evaluation of Tanzania's budget performance. The process was led by the Ministry of Finance. The program of work for PER FY00 was carried out with financial and technical support from various donors, including the World Bank, European Union, UNDP, DFID, Denmark, Sweden, Switzerland, and Finland. This report presents the main outputs of the FY00 PER process in Tanzania in two volumes. Volume I consists of three major parts: Part 1 describes the main features of the PER process as implemented during FY00. Part 2 presents the main findings emerging from a review of fiscal performance and public expenditure management in Tanzania. In addition, part 2 contains a discussion of systemic fiscal issues that are critical to enhancing the efficiency and effectiveness of public expenditures in Tanzania. Part 3 contains summaries of the updates of sectoral expenditure reviews which were undertaken by the priority sector ministries with the support of local and international consultants. The sectors covered include education, health, water, agriculture, works, lands and justice. The volume also contains a data annex and the minutes of the consultative PER meeting held in May 2000. Volume II presents the Government's MTEF for FY01 - FY03, which was discussed at the consultative meeting in May 2000. The MTEF consists of a description of the macroeconomic context, a cross sectoral MTEF which provides the resource envelopes for individual sectors, and sector MTEFs of the priority sectors, i.e., education, health, water, works, agriculture, justice and lands. In addition, the MTEF also contains a detailed discussion of the public sector reform program and the HIV/AIDS pandemic, which is clearly identified as a key challenge for Tanzania's development efforts which requires a multi-sectoral approach to contain its spread. This report is a joint effort of the Government of Tanzania and a team consisting of a Working Group drawn from the World Bank, other UN agencies, bilateral donors, research/academic institutions and NGOs. The joint-donor mission in November/ December 1999 consisted of: Benno Ndulu (mission leader, AFMTZ), Philip Mpango, Ben Tarimo (AFMTZ); Sumana Dhar, Robert Utz (AFTM2); Hamisi Mwinyimvua (University of Dar es Salaam); Frans van Rijn (Netherlands Embassy), Charlotta Norrby (Swedish Embassy), Torben Lindqvist (Danish Embassy) and Stevan Lee (DFID). A follow-up mission in March-April, 2000 was launched to assist the Government to prepare the cross-sector MTEF and sector MTEFs. The report was written under the supervision of Frederick Kilby, Sector Manager, AFTM2 and Peniel Lyimo, Deputy Permanent Secretary, Ministry of Finance, Government of Tanzania. Allister Moon, Senior Economist, ECSPE, and Anand Rajaram, Senior Economist, PRMPS, provided valuable comments and direction as peer reviewers. The document was produced by Patrick Mamboleo under the guidance of Roboid Covington (AFTM2).  PART I THE PER PROCESS  1. PER PROCESS FOR FY00 1.1 AN OVERVIEW OF PER FY00 1.1 The PER Working Group (PER WG), led by the Ministry of Finance, met in August 1999 to agree on the prospectus for the FY00 PER. The group involves sector ministries, donor representatives, academic and research organizations, the private sector, and representatives of civic organizations. The main activities of the PER process for FY00 were focused on three main objectives: (i) to provide direct support to the Government budgeting process, with particular emphasis on the preparation of the budget guidelines and the Medium Term Expenditure Framework (MTEF), (ii) to monitor the composition of expenditure allocation and effectiveness vis-d-vis what was agreed in the previous budget and MTEF, and (iii) to support the development of budget management systems and address key systemic issues in fiscal management. 1.2 The PER activities were organized in two phases. In the first phase (August December) the focus was on undertaking analysis which would provide advice to the Budget Guidelines Committee and guide the updating of sector MTEFs. In the latter, studies were commissioned to obtain updated cost estimates for priority sectors' activities and project financial requirements for the delivery of desirable packages of services. The priority sectors included education, health, water, agriculture, rural roads and for the first time judiciary and lands. As in the previous years, the final activity in the first phase is the assessment of the effectiveness of public spending, which also feeds into the preparation of the budget guidelines. This was carried out by an independent mission led by the Bank with emphasis on assessing aggregate fiscal balance, allocative efficiency and equity in the composition of spending, and technical efficiency in the use of budgeted resources. In addition, the mission also identified some of the critical systemic issues which impinge on the efficacy of budget management. 1.3 The Working Group organized itself into a Macro Group and several sector groups. The macro group focused on ensuring that expenditure plans are consistent with a prudently projected resource envelope and overall macroeconomic stability. It was also charged with the task to provide on advice how resources availed through budget support and HIPC debt relief can be properly reflected in the financing of pro-poor expenditures. Furthermore, the group provided advice to the BG Committee on cross sector prioritization of expenditure allocation based on a variety of Government of Tanzania (GoT) documents, projections of the resource envelope and analysis. 1.4 In the second phase the focus was on preparation of the sector MTEFs and a broadened dialogue amongst all stakeholders on past performance, the next budget frame and the medium term public spending framework. The PER Working Group organized its 1 support around priority sector working groups, which also interacted with the macro group to ensure consistency with the cross sector allocations and the projected aggregate resource envelope. Since simultaneously the GoT continued to hold consultations with the IMF on the macroeconomic frame projections, the macro group took this information into account to advise on any further revisions to the guidelines. 1.5 The second phase ended with a PER consultative meeting, which is an open forum to review the previous and current spending programs; review prioritization in expenditure allocation across sectors in the next budget year as well as the coming three years; and identify critical issues for further improvement of the budget process. Like in the past the participation was very broad and open as the detailed report on the meeting in this volume shows. The meeting also drew lessons from the just ending PER process and proposed improvements of the process for the following year. 1.6 The PER process closed with the last meeting of the PER Working Group in June 2000, after finalization of the budget and revisions to the MTEF. This meeting reviewed inputs from the consultative PER deliberations and discussed a preliminary PER agenda for the next fiscal year. 1.2 TECHNICAL STUDIES IN SUPPORT OF IMPROVED BUDGET MANAGEMENT 1.7 The PER WG commissioned and funded several studies to address selected issues in budget preparation and management, and in medium term strategic resource allocation. (i) Assessment of Aggregate Fiscal Sustainability: Analysis of aggregate fiscal sustainability, carried out by a consultant from Oxford University, helped underpin the resource envelope projections for FY01-03. Particular attention was paid to the effects of projected expenditure expansion with additional resources from HIPC debt relief and continued expansion of new flows. A key issue was to what extent can the relief and new flows finance increased spending sustainably. The analysis also assessed the debt sustainability requirements of a new borrowing program after relief has been secured so as to avoid a relapse to unsustainable debt levels. (ii) Analysis of Development Budget and Counterpart Funding: A major weakness of the development budget is that actual disbursements have tended to fall far short of donor commitments. One of the critical constraints to the disbursement of project funding, the dominant donor financing modality of the development budget is non-availability or delayed release of counterpart funding for projects supported by multilateral institutions. A study carried out by a local research institution, ESRF, reviewed the procedures and donor practices as well as the Government budget and planning processes to identify the main problems behind low out-turn of the development budget and the place of counterpart funding in this problem (iii) Review of Program - Project Support Balance: The overall objective of this analysis was to collect information on the past and current composition of external assistance between program and project support, and to identify the imperatives for shifting it in favor of program support. More specifically to (i) 2 document current policies and practices of the main donors in the allocation of external assistance, (ii) to identify the main requirements (e.g. prudent accountability and management systems) to induce the desired shift from project to program support, (iii) to analyze the magnitude of development spending overheads, such as the cost of project management units (PMUs) and technical assistance (TA) (iv) to gather perceptions on the issue of fungibility of project support. This task was done by bilateral donors as part of a joint World Bank- bilateral donors PER mission. (iv) Poverty Monitoring Indicators and International Development Targets (IDTs): The development of poverty monitoring indicators is crucial for monitoring effectiveness of poverty reduction programs and tracking progress in achieving government commitments to IDTs. Furthermore, under the Local government Reform Program (LGRP) performance indicators are necessary for adopting result orientation in the operation of district block grants and for needs assessment in block grant allocation. The PER process provides an opportunity to mainstream this approach through sector MTEFs and subsequent assessment of achievements in each sector. It was agreed that this work be done by a local consultant (REPOA) partly based on related work on the achievability of the IDTs in Tanzania undertaken by OPM and REPOA as part of a wider DFID- commissioned study to feed into the World Development Report 2000. (v) Tracking of the Road Fund: The aim was to examine the entire process governing the operation of the Road Fund, and more generally, the management of road maintenance in Tanzania at a time when new institutions responsible for these are being set up. The study analyzed the collection and utilization of the Road Fund resources over the last three fiscal years and the capacity and management procedures which were applied for those in order to identify the problems which need to be addressed under the new structures and procedures. (vi) PER FY99 update work: The broad objectives of the exercise included doing a review of recent developments in each of the priority sectors by sub-sectoral components and institutional arrangements as well as roles of other stakeholders (private and public). Other considerations included making an assessment of how the sector in question performed relative to installed capacity; making an objective professional assessment of the quality of service delivery from the perspective of users of the service or product; defining needs and priorities for the sector; providing an update of what is a reasonable package of service and what it takes to deliver this package (come out with strategic costing over the medium term constrained by the resource envelope) and recommend available options. (vii) Update of Cross-sector and Sector MTEFs: The work program for PER FY00 included updating the cross-sector and sector MTEFs. The work of developing the cross-sector MTEF was led by the macro sub-group of the PER working group focusing on projecting the resource envelope (including resources expected to be freed from debt service obligation under HIPC debt relief initiative) for MTEF. This entailed an analysis of Tanzania's revenue effort and checking for consistency of the resource envelope with the agreed medium term macroeconomic frame and soliciting data on projected disbursements by donors over the medium term. The macro group also examining expenditure prioritization to ensure that it is consistent with the agreed macroeconomic objectives as well as economic infrastructure and social service improvements for poverty reduction. The exercise of developing sector MTEFs was confined to the priority sectors including education, health, water, agriculture, roads as in the previous year and two additional priority sectors - Judiciary and Lands. The strategy of gradually extending the MTEF coverage is guided by the objective of ensuring quality of the MTEFs in an environment of limited human capacities in this area. The sector MTEFs were put together by the sector groups from the sector ministries as was the case during PER FY99. However, prior hands-on- training of Government staff involved was conducted. The training focused on reviewing existing planning and budget processes and developing detailed steps to be followed in the preparation of MTEF based budgets. The Ministry of Finance also issued a common format to be followed by all priority sector ministries in preparing the sector MTEF and budget for FY01. The MTEF training was organized by the Economic and Social Research Foundation (ESRF) under IDF support for capacity building with the help of a foreign consultant. 1.8 The program of work for PER FY00 was carried out with the help of financial and technical support from various donors, including The World Bank, European Union, tNDP, DFID, Denmark, Sweden, Switzerland, and Finland. 1.3 IMPLEMENTATION OF PER FY00 1.9 The strategy adopted to implement PER FY00 was to consolidate and deepen the approach adopted since PER FY98. The principal idea was to build on strengthened collaboration and partnership invigorated under the PER process for FY99. The implementation process was steered by a broadened PER working group under the chairmanship of the Deputy Permanent Secretary, Ministry of Finance. In addition to the original members of the working group from the priority sectors (health, education, water, roads, and agriculture), Planning Commission, Ministry of Regional Administration and Local Governments, research and academic institutions (ESRF, REPOA, University of Dar es Salaam) and donors, participation in the broadened PER working group included representatives of the judiciary, private sector, and civil society organizations. The aim of broadening the participatory PER process was to open up the budget process to stakeholders outside the Government. However, since it is not possible to have all stakeholders participating in the PER working group, the PER FY00 process also targeted to initiate more consultations, especially broad based consultations, with particular focus at the lower levels - regional, district, etc. involving grass-root representation, to discuss key public expenditure policies and programs and discuss on how to improve the effectiveness of public expenditure. Regular briefings on the PER work were also carried out during the DAC donors quarterly meetings. 1.10 Learning from the experience of PER FY99 the PER process for FY00 was implemented in two phases. Phase I focused on providing direct support to the Government budgeting process particularly by providing inputs into the preparation of the Budget Guidelines and the development of the medium term expenditure frame for 4 FY01 -03. A significant part of the effort in implementing PER during FY00 was directed at updating expenditure plans for the priority sectors covered by the PER for FY99. The main aim of these activities was to prepare more comprehensive Budget Guidelines which integrate sector plans and checks these for overall consistency with the aggregate projections of resource envelopes and macroeconomic stability. These were then used to update the sector MTEFs and donor financing plans. The updating of sector MTEFs were preceded by training of budget officers from the priority sectors and the central ministries so as to improve on the quality of the MTEFs. Specific studies were also commissioned under PER FY00 and included (i) an in-depth analysis of the development budget and counterpart funding requirement (ii) as survey of donor attitudes towards program and project aid support, and (iii) tracking the Road Fund. The PER working group also served to peer review the outputs of the PER FY99 update work and the specific technical studies. 1.11 The second phase began by fielding a joint World Bank-bilateral donors mission during November-December 1999 to focus on the traditional evaluative function of the PER. This subsequently formed the basis of broader PER consultations in May 2000 during which the GoT presented an MTEF for FY01 to FY03, and a draft budget frame for FYO1 for review by donors and other stakeholders. The purpose of the review was to solicit agreement to the two frames and commitment of donor support in the context of these frames. The meeting also reviewed budget performance since the last PER, discussed fiscal issues emerging from both the evaluation of budget performance and from the set of technical studies. 1.4 LESSONS AND PROSPECTUS OF WORK FOR PER FY01 (1) There were delays in issuing the Budget Guidelines (The Budget Guidelines for FY01-03 were issued in April 2000) partly due to slippage in completing some of the PER FY99 update work but more fundamentally due to late re-constitution of the Budget Guidelines Committee. It is therefore important for the future to have a clearly set PER timetable that dovetails well with the budget cycle and also to ensure that such a timetable is adhered to. In principle the target should be to undertake the technical studies quite early (August to December), then mount the PER main mission during November -December so as to feed into the preparation of the Budget Guidelines to be issues in early January and finally hold the PER consultative meeting with all stakeholders during early May. (2) All stakeholders continued to attach high significance to the PER process and initiatives both in terms of active participation in the PER working group and financing the technical studies. The enthusiasm with the PER exercise is good for consensus building and coordination on budget issues and needs to be nurtured. (3) MoF did send the right signals to the line ministries on the significance to be attached to PER process as a whole and MTEF initiative in particular. Sector ministries responded very well and actually produced much 5 improved sector MTEFs compared to the previous ones. Supervision and coordination of the sector groups by senior officials preferably in the sector ministries will continue to be necessary to entrench the MTEF as part of the GoT reform program. To guarantee sustainability of the process and GoT taking the lead it will be important to ensure continued active involvement of both the Budget and Policy Analysis Divisions of MoF, Planning Commission, Tanzania Revenue Authority (TRA), BoT, IMF and major bilateral donors in the PER working group. Equally, more visible participation by the private sector and NGOs will be key to improving the process further. (4) Although a lot of useful documents are generated by the PER process, it is generally the case that the contents and findings are not fully exploited and disseminated. Thus for the next PER it might be useful to consider holding one or two stakeholder dissemination workshops prior to the main PER consultative meeting. (5) Finally, the next cycle of the PER should consider initiating studies in the following areas: (i) fiscal decentralization focusing on the process and its substantive link to the budget management system (ii) sector specific expenditure tracking down to the service delivery units, and (iii) evaluation of public expenditure on a quarterly basis. Particularly to track poverty related expenditure in relation to PRSP and HIPC. 6 PER FY00 SUPPORTING ACTIVITIES S/N STUDY / ACTIVITY SUPPORT TO GoT FINANCIER PROVIDED BY 01 Aggregate Fiscal Sustainability * Mr. David Bevan, * DFID University of Oxford 02 Analysis of the Development * ESRF + Denmark Budget & Counter-part Funding 03 Poverty Monitoring Indicators * REPOA * UNDP 04 Road Fund Tracking Study + Louis Berger S.A, Paris * EU 05 PER FY99 Update work: * Education * Oxford Policy Management * Sweden & World Bank & University of DSM * Health * Beatrice Aswiena (Kenya) * DFID * Water + FSRF + Finland + Agriculture * ESRF * World Bank * Trunk & Regional Roads + COWI Consult + Norway * District Roads * REPOA + SDC * Justice & Constitutional * ERB- University of DSM * Denmark Affairs 06 MTEF FYOO-FYO3: * Development of Macro- * PER Macro Group MTEF * Development of Sector * PER Sector Groups MTEFs + MTEF Training * Elizabeth Muggeridge, * DFID Africa Consulting 07 External Evaluation of Budget World Bank, DFID, Netherlands Performance Embassy, Swedish Embassy, Danish Embassy 7  PART II REVIEW OF FISCAL PERFORMANCE, FISCAL POLICY AND SYSTEMIC FISCAL ISSUES 8  2. REVIEW OF FISCAL PERFORMANCE 2.1 INTRODUCTION 2.1 This chapter provides a review of fiscal developments and expenditure management issues and covers the fiscal year FY99 and the first eight months of fiscal year FY00. The first four sections focus mainly on fiscal performance. The analysis is broken down into three distinct areas of fiscal performance - aggregate fiscal discipline, strategic allocation, and technical efficiency. This is followed by a review of the main findings of the Report of the Controller and Auditor General for the financial year ended 30th June, 1998. 2.2 The analysis of fiscal performance is followed by a review of the institutional setup for expenditure management. The analysis is guided by a framework which suggests which institutional factors are important for good expenditure performance and we assess to what extent these factors are present in the Tanzanian system and whether they are yielding the expected results. Particular attention is also paid to recent reforms that took place in the area of expenditure management. 2.3 The paper concludes by presenting the main results of a tracking study of road funds that was undertaken as part of the PER process. Recent work on poverty and growth in Tanzania has highlighted the crucial importance of road infrastructure to enable rural communities, which are home to the majority of Tanzania's population and have the highest incidence of poverty, to enhance their income earning capability through expanded access to regional markets and trade. The establishment of the Roads Fund was designed as an important instrument to support road maintenance and the purpose of the tracking study was to identify whether the availability of funds for the road sector has indeed increased and contributes to improved maintenance of the road network. 2.2 AGGREGATE FISCAL DEVELOPMENTS Domestic Revenue and Foreign Inflows 2.4 Total revenue as a percentage of GDP continued its decline from the peak of 13.5% of GDP reached in FY97 to 12.0% in FY98 and to 11.5% in FY99. In FY00, revenue declined further to 11.2 percent of GDP. In FY99 tax revenue was only 10.3 percent of GDP and non-tax revenue was 1.2 percent of GDP. Underlying the decline in tax revenue over the past few years are substantial reductions in external taxes, relatively large tax incentives for new investments, the continued downsizing of the parastatal sector, and sluggish private sector growth which has not yet yielded enough revenue to compensate for lost revenue from the shrinking parastatal sector. In FY99, the bulk of 9 the revenue shortfall was accounted for by a sharp decline in revenue from other taxes, which declined from 1.8 percent of GDP in FY98 to only 1.2 percent of GDP in FY99. This is mainly the result of the streamlining of the tax system and the elimination of a number of nuisance taxes. Increasing tax revenue is the key challenge in the area of fiscal management, given the substantial expenditure requirements that arise in connection with Government's role of providing infrastructure services and basic social services in support of economic growth and poverty reduction. The medium-term program of strengthening tax administration is ongoing and expected to yield tangible results in the near future. In addition to administrative improvements, the streamlining of tax exemptions is another potential source for additional revenue generation. Table 2.1: Government Revenue and External Grants, FY95 - FY00 Central Government OpRations FY95 FY96 FY97 FY98 FY99 FY00/1 Total Revenue 12.5% 13.2% 13.5% 12.0% 11.5% 11.2% Tax Revenue 11.3% 11.3% 11.9% 11.0% 10.3% 9.9% Taxes on imports and exports 3.4% 3.6% 3.8% 3.5% 3.6% Sales and excise taxes on local 2.7% 2.8% 3.1% 2.7% 2.7% goods Income taxes 3.3% 3.1% 3.0% 2.9% 2.7% Other taxes 1.9% 1.9% 2.1% 1.8% 1.2% Non tax revenue 1.2% 1.9% 1.6% 1.0% 1.2% 1.2% /1 Likely Outturn Source: IMF, Tanzanian authorities 2.5 The decline in domestic revenue was only partly offset by increases in official development assistance in the form of grants and concessional loans (net of amortization). During fiscal year FY99 these inflows increased to 4.4 percent from 4.0 percent of GDP in FY98 and further to 4.8 percent in FY00. The increase in FY99 is due to a recovery of grants from 3.0 percent of GDP in FY98 to 4.0 percent of GDP in FY99 and which are expected to remain at that level in FY00. Net inflows from foreign loans on the other hand declined from 1 percent of GDP in FY98 to 0.4 percent in FY99, mainly because of a drop in disbursements of program lending. 10 Table 2.2: Foreign Inflows - Grants and Loans, FY95 - FY00 Central,Govemment Operations FY95 FY96 FY97 FY98 FY99 FY00/1 Grants and Loans 2.9% 1.0% 3.1% 4.0% 4.4% 4.8% Grants 2.0% 2.2% 3.6% 3.0% 4.0% 4.0% Program 0.8% 1.0% 1.8% 0.7% 1.2% 1.9 Project 1.2% 1.2% 1.8% 2.3% 2.8% 2.2 Foreign loans (net) 0.9% -1.2% -0.5% 1.0% 0.4% 0.8% Foreign loans (loan 2.4% 0.2% 0.8% 2.1% 1.6% disbursements) Program loans (import 1.2% 0.0% 0.5% 1.3% 0.6% support) Development project loans 1.3% 0.1% 0.3% 0.8% 1.1% Amortization -1.6% -1.4% -1.3% -1.1% -1.2% /1 Likely Outturn Source: IMF, Tanzanian authorities Government Expenditures 2.6 Government spending stabilized in FY98, claiming 14.9% of GDP, after declining steadily in previous years from 18.3 percent in FY95. In FY00, expenditures increased by 1 percent of GDP. Although there was little change in recurrent expenditures between FY98 and 1998/99, there was a significant shift from wages and salaries to expenditures on other goods and services. Table 2.3: Government Expenditures, FY95 - FY99 Central Government Operations FY95 FY96 FY97 FY98 FY99 FY00/ Total expenditure and net lending 18.3% 17.6% 15.1% 14.8% 14.9% 15.9% Recurrent expenditure 15.1% 14.0% 12.5% 11.0% 10.9% 12.0% Wages and salaries 4.2% 4.6% 4.7% 4.2% 3.7% 4.2% Interest payments 3.4% 3.3% 2.6% 2.2% 1.6% 1.6% Domestic 2.2% 2.3% 1.7% 1.0% 0.6% 1.1% Foreign 1.2% 1.0% 0.9% 1.3% 1.0% 0.5% Other goods and services and transfers 7.5% 6.1% 5.1% 4.5% 5.7% 6.2% Development expenditure and net 3.2% 3.6% 2.6% 3.8% 4.0% 3.9% lending o/w Expenditure financed domestically 0.8% 0.2% 0.5% 0.5% 0.3% 0.3% /I Likely Outturn Source: IMF, Tanzanian authorities 2.7 Since average salaries increased in nominal terms only by 1.3 percent in FY99 and the number of civil servants was reduced by another 2.7%, expenditures on wages and salaries remained more or less constant in nominal terms, implying a decline in 11 expenditures on wages and salaries as a percentage of GDP from 4.2 percent in FY98 to only 3.7 percent in FY99. Salary increases below the rate of inflation have led to real income losses for civil servants of up to 35 percent since FY96. However, after further real wage losses in FY99, in FY00 Government started the implementation of its Medium Term Pay Policy by granting salary increases ranging between 16 and 65 percent, with the higher increases being accorded to technical personnel and middle and upper management. In addition, the reduction in staff numbers was only 1.3 %, significantly less than in previous years. These large pay increases combined with only small reductions in the staffing levels led to a projected increase in the wage bill in FY00 by more than 30 percent and an increase in expenditures on salaries and wages from 3.7 percent of GDP in FY99 to 4.3 percent of GDP in FY99. Table 2.4: Civil Service Employment, FY97-FY99 (December of each year) Salary Scale FY97 FY98 FY99 FY99 FY98 FY99 FY99 Staff in absolute numbers Percentage change TGOS 39216 35651 34806 35001 -9.1% -2.4% 0.6% TGS 189720 63787 63310 59994 -0.7% -5.2% TGTS Included 122215 118868 119566 -2.7% 0.6% in TGS TPSW - TGPSW 37741 36190 34821 36448 -4.1% -3.8% 4.7% OTHERS 18947 12785 11381 8837 -32.5% -11.0% -22.4% TOTAL 285624 270628 263186 259846 -5.3% -2.7% -1.3% Source: CSD Table 2.5: Civil Service Average Salaries, FY97-FY99 Salary Scale FY97 FY98 FY99 FY99 FY98 FY99 FY99 TGOS 33707 37703 38212 47220 11.9% 1.4% 23.6% TGS 47099 57313 57625 78067 0.5% 35.5% TGTS Included 56314 57073 80162 1.3% 40.5% in TGS TPSW + TGPSW 65002 60506 61400 70925 -6.9% 1.5% 15.5% OTHERS 35344 115878 108011 167861 227.9% -6.8% 55.4% TOTAL 47498 54684 55387 74143 15.1% 1.3% 33.9% Source: CSD 2.8 In FY99, savings on wages were used to increase expenditures on goods and services from 4.5 percent of GDP in FY98 to 5.7 percent in FY99. In FY00, the increases in wages and salaries without a parallel increase in resource availability have led to a crowding out of expenditures for other charges during the first eight months of the financial year. 2.9 Expenditures on interest payments declined from 2.2 percent in FY99 to 1.6 percent in FY00, as a result of a fall in both domestic and foreign interest payments. During FY00, foreign interest payments are projected to fall substantially from 1 percent of GDP to 0.5 percent of GDP. However, this decline in foreign interest payments is offset by an increase in domestic interest payments to one percent of GDP. About four percent of GDP or a little more than one fourth of the overall budget is spent of development expenditures, most of which is foreign financed. However, problems with 12 the proper integration of development expenditures in the budget continue. Data on official development expenditures collected by UNDP indicate that official development assistance is about 12 percent of GDP, indicating that still only about one third of all development assistance to Tanzania is captured in the budget. Deficit Financing 2.10 Following the introduction of the cash budget in 1996, Tanzania recorded continuous budget surpluses (after grants) in the past three years. In FY99, the surplus was 0.3 percent of GDP. In FY00 a small budget deficit in the magnitude of 0.6 percent of GDP was registered. However, taking into account net inflows from foreign loans, which also constitute development assistance and contain a significant grant element, the surplus for FY99 increases to 0.8 percent of GDP and the deficit for FY00 turns into a small surplus of 0.2 percent of GDP. These surpluses have allowed Government to reduce its outstanding debt with the domestic banking and non-banking institutions and also repay arrears to a significant extent. Table 2.6: Financing of the Fiscal Deficit, FY95 - FY00 Central Govemtment Operations FY95 FY96 FY97 FY98 FY99 FYQD0/1 Overall balance before grants (checks -5.9% -4.3% -1.6% -2.8% -3.5% -4.7% issued or commitment basis) Overall balance after grants (checks -3.9% -2.2% 2.0% 0.2% 0.5% -0.6% issued or commitment basis) Overall balance after grants (checks -5.0% -3.0% 1.9% 0.2% 0.3% -0.6% cleared or cash basis) Foreign loans (net) 0.9% -1.2% -0.5% 1.0% 0.4% 0.8% Overall balance after grants and -4.1% -4.2% 1.3% 1.1% 0.8% 0.2% foreign loans (checks cleared or cash basis) Domestic (net) 3.3% 3.3% -0.7% -0.4% -0.2% -0.1% Bank 2.1% 2.7% -0.4% -0.9% 0.0% Non bank (net of amortization) 1.2% 0.6% -0.3% 0.5% -0.1% Privatization Funds 0.0% 0.5% 0.3% 0.1% 0.2% . 0.8% 0.4% -0.9% -0.8% -0.8% Change in arrears /1 Likely Outturn Source: IMF, Tanzanian authorities Budget Implementation 2.11 Previous Public Expenditure Reviews have highlighted the lack of predictability of budget releases as one of the main problems afflicting the budget process in Tanzania. This unpredictability of resource flows from the Treasury to spending units has a direct impact on the allocative and operational efficiency of the budget system, which will be discussed in subsequent sections. At the aggregate level, it is instructive to analyze the sources of shocks to government revenue and to trace its effects on the various expenditure items. 13 Table 2.7: Sources of Budget Shocks FY97 FY98 FY99 Budget Outturn Outturn Budget Outturn Outturn/ Budget Outturn Outturn/ / Budget Budget Budget TShm % TShm % TShm % Total Resources 703142 685630 98% 800200 700969 88% 779786 799100 102% Domestic Revenue 563756 572030 101% 671500 619083 92% 699521 689500 99% Import Support 139386 113600 82% 128700 81886 64% 80265 109600 137% Less First Claim 371075 399776 108% 422500 421831 100% 435360 431378 99% Expenditures Debt Service and 185710 200548 108% 196500 203024 103% 190578 210900 111% Arrears Wages and Salaries 185365 199228 107% 226000 218807 97% 244782 220478 90% Available Resources for Other Expend. And Dom. Dev. 332067 285854 86% 377700 279138 74% 344426 367722 107% Total Other and 387822 311897 80% 518400 410348 79% 562898 471000 84% Development Other Goods and 260831 187327 72% 274300 223763 82% 298433 340900 114% Services Development 126990 124570 98% 244100 186585 76% 264465 130100 49% Residual (checks issued) -55755 -26043 47% -140700 -131210 93% -218472 -103278 47% Adj. To cash and other 6600 -15900 items Residual (checks cleared) -55755 -26043 47% -140700 -124610 89% -218472 -119178 55% Financing of Residual 55755 26043 47% 140800 124612 89% 218472 119217 55% Foreign Project 48152 63900 133% 149400 174362 117% 229000 117717 51% Financing Domestic Financing 7603 -37857 -498% -8600 -49750 578% -10528 1500 -14% Source: Data provided by authorities and staff estimates 2.12 Compared to the previous two years, when resource availability from domestic revenue and import/budget support was below the budget estimates, for FY99 the resource availability from these sources was in fact slightly above the estimated amounts, mainly on account of higher than projected import/budget support from donors in the form of grants and loans. 2.13 First claim expenditures consisting of debt service payments and payments for wages and salaries were also within the resource envelope provided by the budget. However, while payments for wages and salaries were considerably less than was budgeted, this was offset by higher than estimated debt service payments. This is reminiscent of FY98, where there also was an apparent trade-off between under spending on supply votes and increased debt service payments. 2.14 As a result of the positive developments on the side of resource availability and the containment of first claim expenditures within the limits provided by the budget, 14 available resources for expenditures on account of "other charges" and for domestic development expenditure was seven percent higher than estimated in the budget. This higher resource availability translated directly into higher spending on goods and services (14 percent above budget) and domestically funded development expenditures (88 percent above budget). As in previous years, total development expenditures funded from both domestic and foreign sources, was again significantly below the budgeted amounts. In fact, the discrepancy for FY99 amounted to about 50 percent and was thus considerably higher than in previous years. 2.15 Overall, compared to previous years FY99 represents a significant improvement with respect to the predictability and availability of funds for financing operations and maintenance and domestic development expenditure. 2.3 SECTORAL ALLOCATIONS AND PRIORITIZATION 2.16 Table 2.8 shows the sectoral distribution of actual recurrent expenditures for the period FY96 - FY00. In FY99, debt service payments from the consolidated fund declined significantly, which led to a reduction of the share of consolidated fund services in total recurrent expenditures from 37.2 percent in FY98 to only 30 percent in FY99. During the first eight months of FY00, the share of consolidated fund service payments in total recurrent expenditures increased slightly to 33 percent. In FY99, most of the savings for reduced debt service payments were used to increase expenditures in administration, the social services, and the productive sectors. In the administrative sector, the President's Office, the Ministry of Foreign Affairs, and the Ministry of Finance saw the largest increases in recurrent expenditure. Much of the increase in expenditures by the Ministry of Finance is explained by the centralization of payments for electricity. In the social sectors, the shares of the Ministry of Health and the Ministry of Science, Technology, and Higher Education increased from 4.1 percent to 4.8 percent and from 3.1 to 4.2 percent, respectively. Unfortunately, the allocation to regions for the delivery of basic social services declined from 17.2 to 16.6 percent and the share of the Ministry of Education declined also from 2.7 percent to 2.5 percent. In the productive sectors, expenditures of all three Ministries covered increased significantly, Agriculture by 0.6 percentage points, Industries and Trade by 0.2 percentage points, and Tourism, Natural Resources, and Environment by 0.7 percentage points. Data for the first eight months of FY00 imply relative gains by the defense sector and the social sectors, with reductions in the share of all other sectors. Table 2.8: Sectoral Shares in Total Recurrent Expenditures - Actual Sector FY96 FY97 FY98 FY99 FYOO* Administration 16.8% 10.7% 12.3% 16.5% 12.3% Defense And Security 19.1% 18.7% 17.0% 17.0% 17.7% Social Services 28.4% 26.2% 27.6% 29.5% 32.7% Economic Services 1.6% 4.6% 3.3% 3.1% 2.2% Productive 4.1% 2.7% 2.6% 4.0% 2.1% Consolidated Fund Service 29.9% 37.0% 37.2% 30.0% 33.0% Grand Total 100.0% 100.0% 100.0% 100.0% 100.0% * July to February Source: Appropriation Accounts for data up to FY99, Flash Reports for FY00 15 2.17 Table 2.9 shows nominal growth rates of actual expenditures. Throughout the period FY97-FYOO, social services were the only sector whose expenditures grew consistently faster than overall government expenditures. Defense expenditures increased at about the same rate as overall expenditures during most years, while the other sectors saw significant variations in their expenditure levels over the past five years. During FY99, the administrative and productive sectors received the biggest increases among all sectors. However, during the first eight months of FY00 expenditure cuts affected mainly these two sectors and economic services. Table 2.9: Sectoral Growth Rates of Recurrent Expenditures - Actual Sector FY97 FY98 FY99 FY00* Administration -14.0% 36.6% 52.8% -18.1% Defense And Security 32.0% 8.2% 14.0% 14.4% Social Services 24.7% 25.7% 21.3% 21.9% Economic Services 286.3% -14.3% 5.4% -23.3% Productive -11.4% 14.6% 74.7% -42.0% Consolidated Fund Service 67.3% 20.0% -8.3% 20.7% Grand Total 35.1% 19.3% 13.8% 9.7% * July to February Source: Appropriation Accounts for data up to FY99, Flash Reports for FY00 2.18 With respect to development expenditures, there was a significant reorientation of expenditure patterns from administration to the social sectors. While in FY98, the Ministries of Finance, Defense and National Security and the Prime Minister's Office received significant resources for development purposes, in FY99 their share was drastically reduced. On the other hand, the Ministry of Water, which in FY98 only received 0.6 percent of the development budget received in FY99 17.3 percent of the development budget. The Ministries of Health and Education as well as the Regions also saw significant increases in their share of the development budget in FY99. However, given the multitude of problems with the capturing of information on development expenditures which are mainly financed by donors, the information from the development accounts needs to be considered with great caution. As many development expenditures funded by donors are not captured in the budget estimates and the appropriation accounts, it is difficult to ascertain the true distribution of development expenditures across sectors. Changes in the coverage of donor expenditures are also a possible source of apparent changes in sectoral allocations of development expenditures. Table 2.10: Sectoral Shares in Total Development Expenditures - Actual Sector FY96 FY97 FY98 FY99 Administration 21.4% 49.0% 24.2% 1.4% Defense And Security 1.3% 0.9% 0.2% 0.0% Social Services 37.5% 26.0% 22.5% 49.6% Economic Services 23.1% 21.7% 40.1% 40.2% Productive 16.7% 2.5% 13.0% 8.8% Consolidated Fund Service 0.0% 0.0% 0.0% 0.0% Grand Total 100.0% 100.0% 100.0% 100.0% Source: Appropriation Accounts 2.19 In the following we examine allocations to the priority sectors in more detail. In the first instance we examine whether the share of expenditures allocated to the priority 16 sectors has increased during the past two years and whether allocations to the priority sectors were respected during budget implementation. Priorities for budget allocations are defined in the Government's budget guidelines. Prior to FY99, the RPFB had emphasized resource allocation to four priority sector groups: social services, infrastructure, law and order and environment. However, as the budget guidelines for FY99 state "not much effort has been put in translating Government priorities into strategic options given the obvious limitations of the resource envelope." The budget for FY99 was the first to benefit fully from the newly introduced PER process and Government's intention was to "fully fund and accord protection status to few strategic expenditures within priority sectors." For FY99, the priority areas defined in the budget guidelines include: * Roads * Education * Water * Agriculture * Energy * Law and Order * Health 2.20 In addition to these priority areas, the national population census 1998, payment of utility bills (to be paid centrally by MoF) and the settlement of arrears were other priorities defined for FY99. The expenditure priorities of FY00 were similar, with Land issues, the implementation of the Civil Service Reform, the payment of debts, general elections, and the implementation of the LGRP added to the priorities. In the context of the PER process and Government's focus on poverty reduction, these priority sectors have been further narrowed down to those areas that are likely to have the biggest impact on poverty reduction, i.e., rural roads, water, basic health, primary education, agricultural research and development and extension and the Judiciary. 2.21 Table 2.11 shows the development of actual recurrent expenditures for the priority sectors for the period FY98 to FY00, both as shares of discretionary expenditures as well as in nominal growth rates. Throughout the period, actual expenditures on priority sectors grew slightly faster than expenditures on non-priority sectors. This led to an increase in the share of discretionary expenditures going to the priority sectors from 42.8 percent in FY97 to 46.7 percent in FY00. Growth rates of actual expenditures vary significantly across the various priority areas. During FY99, the nominal growth of expenditures in the Judiciary and Education Sector was actually below the average growth rate of discretionary expenditures and in FY00 only education sector expenditures were above the average growth rate of discretionary expenditures. 2.22 Table 2.12 presents a more detailed analysis of priority expenditures during the first eight months of FY00. The budget estimates indicated significant increases in allocations for "other charges" to the priority sectors. In particular, allocations for "other charges" to local governments for social services were more than doubled in FY00, reflecting partly the shift of responsibilities to Local Governments for the management of social service delivery under the Local Government Reform Program. However, comparing actual exchequer releases to the priority sectors for the first eight months of FY00 to exchequer releases during the same period in FY99 shows that exchequer releases are significantly below the budgeted increases. Instead of the budgeted increase for OC to local governments by 221.7 percent, the actual increase during the first eight month of FY00 was only 158.5 percent. For all other priority areas, exchequer releases 17 during the first eight months of FY00 were actually less than during the same period of FY99. Table 2.11: Recurrent Expenditure in the Priority Sectors, 1997/99-FYO0 FY97 FY98 FY99 FYOO* FY97 FY98 FY99 FYOO* As share of discretionary expenditure Nominal annual growth rate Judiciary 1.0% 1.1% 1.0% 0.7% 34% 26% 17% -23% Agriculture & 3.3% 2.9% 3.3% 1.2% 18% 5% 47% -62% Livestock Education/1 21.1% 22.1% 18.9% 25.9% 25% 25% 9% 43% Works (plus Road 6.5% 5.9% 8.2% 5.2% 349% 9% 77% -33% Fund)/1. Lands, Hous.,& Urb. 0.1% 0.1% 0.5% 0.5% -63% 25% 381% 9% Dev. Water/1 2.9% 3.1% 3.3% 3.4% 21% 27% 37% 9% Health!] 8.9% 10.5% 10.6% 10.4% 32% 40% 29% 2% Total Priority 42.8% 44.6% 44.8% 46.7% 40% 24% 28% 9% Total Discretionary 100.0% 100.0% 100.0% 100.0% 21% 19% 28% 4% /1 includes transfers to districts * July - February On the other hand, the implementation of the pay reform program led to a significant increase in exchequer releases for personal emoluments during the first eight months of FY00. As a consequence of the local government reform program, there were further transfers of staff from various priority ministries and regions to local governments. This resulted in lower than average increases in PE releases for these spending units, while the exchequer releases to local governments as well as to the ministries of education and health were above the average increase of PE by 30.5 percent. Table 2.12: Change in Allocations and Exchequer Releases to Priority Sectors, FY00 (July- February) change over July-Feb FY99 Ministry/Department PE IPE OC OC OC+PE OC+PE Estimate Actual Estimate Actual Estimate Actual Judiciary 39.2% 24.0% 151.6% -51.5% 78.4% -8.1% Ministry of Education 9.4% 36.8% 20.0% -7.7% 13.8% 14.6% Ministry of Health -4.9% 32.7% D -.9% Ministry of Water 5.0% 20.8% 12.0% -49.4% 7.4% -22.8% Regions (Social -18.3% 114% 49.4% -57.4% -11.9% -8.1% Services) I 1 Local Government 1.9% 41.3% 221.7% 158.5% (Social Services) Ministry of Agriculture -1.4% -39.9% 7.5% -81.6% 2.6% -62 and Co-operatives i GRAND TOTAL 3.6% 30.5% 49.3% -7.3% 27.5% 8.5% Source: Ministry of Finance, Policy Analysis Department Differences to the changes shown in table 14 are due to different methods of calculation. While in this table the change in exchequer releases during the first eight months is computed, in table 14 data for 1999/2000 are extrapolated and compared to actual expenditures in the previous year. 18 2.23 As mentioned elsewhere, development expenditures recorded in the budget estimates and in the appropriation accounts give only a very incomplete picture of actual development expenditures, the majority of which is donor financed. This is even more true for the priority sectors, as most donor support typically concentrates on these sectors. In many cases, donor support is directly provided to the ministries or to local authorities without ever being properly recorded in the budget accounts. Keeping in mind these caveats, the share of the development budget going to the priority sectors has increased steadily during the past three years. While in FY98 only 31.1 of the development budget was allocated to the priority sectors, in FY00, 61.7 percent were allocated to these sectors. Parallel to increases in allocations were increases in actual expenditures. However, the prioritization is less pronounced in actual development expenditures than in the estimates. The share of actual development expenditures (recorded in the appropriation accounts) increased from 19.9 percent in FY98 to 42.9 percent in FY99. Table 2.13: Development Expenditure in the Priority Sectors (as % of total recurrent expenditure), 1997/98-FYOO VOTE HOLDER FY98 FY99 FY00 budget actual budget actual budget actual Judiciary 0.0 0.0 0.0 0.0 0.0 Agr. & Livestock 1.8 6.1 8.4 7.0 13.4 Education 2.6 6.9 4.2 6.8 10.3 Works & Trans 15.2 0.0 19.6 14.0 16.7 Lands, Housing 0.4 0.0 0.0 0.0 0.2 Water, Energy 2.5 0.6 11.7 6.7 10.1 Health 8.6 6.3 8.2 8.5 10.9 TOTAL 31.1 19.9 52.0 42.9 61.7 2.4 OPERATIONAL EFFICIENCY 2.24 This section discusses cross cutting issues that affect the operational efficiency in all sectors. Operational efficiency concerns the question of whether the public sector is able to achieve the planned and budgeted for service delivery objectives and whether it does so in an efficient manner. Sector specific indicators of operational efficiency are discussed in the sector PERs. However, although performance budgets have been developed for all ministries, relatively little progress has been made in developing output and outcome indicators which would allow the monitoring of the impact of public expenditures and thus assess technical efficiency. Nonetheless, there is ample evidence that service delivery is poor in most parts of the public sector and that efficiency in the public sector is low. From a budget perspective, the key constraints to operational efficiency were (a) insufficient resource availability for expenditures on operations and maintenance, (b) unpredictability of resource availability for vote holders, and (c) civil service wages that are for the middle and upper level civil servants significantly below those in the private sector. Improvements in these areas are essential if other measures such as the introduction of performance management systems and the implementation of anti-corruption measures are to achieve their intended purposes. 19 Public Sector Reform Program 2.25 A well motivated, efficient, honest, performance-oriented civil service is the key determinant of technical efficiency in the delivery of public services. Between 1993 and 1998 Government has been implementing the Civil Service Reform Program which has achieved the following results:2 * The civil service workforce was reduced from roughly 354,600 in FY94 to about 264,000 by FY99; * The salary structures were rationalized and decompressed, the old scheme with 196 grades under 23 scales as reduced to 45 grades under four scales; * 36 inequitably and non-transparently awarded allowances were eliminated or consolidated into the revised salary structure; and * greater control was gained over the wage bill and the integrity of the payroll was restored. 2.26 However, the reforms undertaken under the CSRP did not lead to significant increases in civil service take home pay. The increase in average real pay by 75 percent in real terms over the period FY94 to FY98 was mainly the result of the consolidation of allowances into the salary structure rather than real increases in take home pay. Indeed, during the last three years, middle and upper level civil servants experienced real income losses of up to 35 percent. This led to a further widening of the gap between public and private sector salaries and gives rise to a multitude of problems such as low motivation, vulnerability to petty bribery, or moonlighting. While pay reform by itself will not eliminate all problems in the public sector, it is nonetheless a necessary condition for other reforms under the Public Sector Reform Program to be effective. 2.27 The Public Sector Reform Program (PSRP) extends and carries forward the CSRP. The program comprises three phases and extends over the period 2000-2011: Phase 1: Installing a Strategic Process for Sustainable Performance Improvement (2000-2004); Phase 2: Institution a Performance Management Culture (2005-2011); and Phase 3: Establishing Quality Improvement Cycles (2009-2011). 2.28 The core of Phase 1 are measures to improve the incentive structure and to create a close link between performance and budgets. In particular, the operationalization of the "Performance Improvement Model" includes strategic planning, annual performance planning and budgeting linked to the overall government budget process, systematic execution of plans and budgets with a focus on service improvements, and monitoring, evaluation, and reporting. Availability of Resources for Operations and Maintenance 2.29 Insufficient allocations for operation and maintenance expenditures are the second major problem affecting public sector efficiency. The introduction of the cash budget has 2 URT, Pay Reform Implementation Study: Operationalizing the Medium Term Public Service Pay Policy. Draft Final Report. 21 May 1999. 20 aggravated the problem of a shortage of funds for operations and maintenance. Under enforced tight resource constraints, expenditures for operations and maintenance have the role of the residual, i.e., these expenditures are only funded from what remains after taking care of statutory payments such as debt service and wages and salaries. However, at a more fundamental level, under-funding of operations and maintenance has its origin in two problems frequently encountered in public expenditure management. The first is the undertaking of investment projects without properly taking into account the required financial resources for operations and maintenance. Examples are the road net work, where even following the increase in resources made available through the Roads Fund, it is estimated that these resources are only sufficient to properly maintain about one fourth of the existing roads network in Tanzania. Another example is Tanzania's extended health network. Public resources are neither sufficient to properly maintain physical structures of hospitals, dispensaries, and health centers nor to provide adequate amounts of drugs, thus limiting the capacity of these facilities to provide effective services. The second problem arises from an over-ambitious expansion of service delivery targets and a definition of the role of government which is not compatible with available resources. This leads to a squeezing of operations and maintenance expenditures, which are then spread too thinly across the public sector as to allow effective service delivery. 2.30 FY99 represented a turning point with regard to the provision of funds for operation and maintenance. After a period of continuous decline, which saw expenditures on goods and services plunge from 7.5 percent of GDP in FY95 to only 4.5 percent in FY98, FY99 was the first year that saw an increase in expenditures by more than one percent of GDP and for FY00, expenditures on goods and services are expected to increase to 6.2 percent of GDP. While this reversal in the downward trend of operation and maintenance expenditures is very welcome, it remains yet to be established to what extent these increased expenditures indeed translated to improved service delivery. 2.31 The share of OC in total expenditure increased for all sectors and with the exception of the administrative sector, exchequer releases for Other Charges were above the budgeted amounts. During the first eight months of FY00, increases in expenditures on wages and salaries in combination with revenue shortfalls led to a serious crowding out of expenditures on Other Charges. Overall, actual expenditure for Other Charges were only three fourth of the budgeted amounts and the share of actual Other Charges in total expenditures declined significantly during the fiscal year. Table 2.14: Sectoral expenditures on OC and PE, FY99-FYOO FY99 FYOO* Share of OC Actual as % of Estimate Share of OC Actual as % of Estimate in Total PE OC in Total PE OC Administration 84% 92% 95% 75% 108% 66% Defense and 46% 93% 127% 39% 109% 88% Security Social Services 41% 98% 122% 34% 133% 93% Economic 88% 86% 131% 88% 108% 61% Services Productive 71% 88% 156% 56% 71% 60% Total 58% 95% 115% 50% 119% 74% * July to February 21 Predictability of Resource Availability 2.32 A consequence of the cash budget is the unpredictability of available resources for operation and maintenance expenditures. Figure 1 graphs monthly data on tax revenue, interest payments and expenditures on "other goods and services." Expenditures on "other goods and services" show large month on month fluctuations, driven mainly by fluctuations in revenue and lumpy interest payments. Figure 1: Tax Revenue, Interest Payments, and Expenditure on Other Goods and Services MoNrthly Revenue and Expenditure, FY98 Monthly Revenue and Expenditure, FY99 700 -- 8000 6000 Tax Reva-ue Tax Revente 50000 - ------ - -- - 60000- 40000 -- Other Goods Other Goods 30000 - -andservices 4000 --- - - andservices 20000 - -- Interest 20000 Inteest 1000 ---- - - payment - paymat 0 0 . 1 3 5 7911 1 3 5 7 9 2.33 We also examine how these aggregate fluctuations were passed on Figure 2: Ratio of Actual to Budgeted to spending units. The purpose of this Expenditures on OC for Priority and Non- analysis is to (a) identify cash Priority Sectors, January - September 1999 management patterns with respect to 300% releases to individual vote holders, (b) establish whether the priority sectors of health, education, water, agriculture, and the regions differ from those of non-priority sectors, and (c) gauge to what extent monthly cash releases to 0. ministries are distorted by the cash 0% budget system currently in place in to 0 Tanzania. The main instrument for the s Priority Non-Pnorty (excl. Finance) analysis is to trace the ratio of actual to budgeted releases on "other charges" Source: Tanzanian Authorities for FY99 and the first eight months of FY00. 2.34 We start the analysis by looking at overall releases on "other charges" for priority and non-priority ministries before we proceed to the more detailed analysis of selected 30%3 priority and non-priority ministries.P Exchequer releases to the Ministry of Finance are excluded from all aggregates, since funds initially allocated to the Ministry of Finance are In this analysis, exchequer releases to the following Ministries are included: Ministry of Education and Culture, Ministry of Health, Ministry of Agriculture and Cooperatives, Ministry of Water. the Judiciary as well as exchequer releases to the regions and local governments in the areas of social services. 22 used to affect reallocations during the year and inclusion of data on the Ministry of Finance would thus distort the analysis of allocations and exchequer releases to spending units. Road Fund expenditures are also excluded since they are funded from earmarked resources and thus outside the normal allocation process. During FY99, until April 1999 monthly exchequer releases for "other charges" for both priority and non-priority sectors were significantly above budgeted amounts. Thereafter, for the last two months of FY99 exchequer releases to the priority sectors were significantly below estimates and for the first eight months of FY00, exchequer releases to both priority and non-priority sectors were below the estimated amounts. The volatility of exchequer releases to the priority sectors is significantly higher than that of non-priority sector releases. Given the overall pattern of overall resource availability in FY99, priority sectors have benefited more from additional resources for other charges than the non-priority sectors. However, for the first eight months of FY00, the shortfall of overall resource availability for other charges compared to estimates has affected priority sectors more than non-priority sectors. These patterns appear to indicate that priority sectors are given a certain priority in the allocation of additional resources but are not protected in the case of resource shortfalls. While in FY99, priority sectors received 34 percent of all exchequer releases for "other charges," in FY00 this share fell to only 25 percent of a shrinking overall allocation. 2.35 Figures 4 and 5 show the ratio of actual exchequer releases to budget estimates for a sample of priority and non-priority spending units, respectively. From the visual inspection of expenditure patterns for priority and non-priority sectors several observations emerge: * Month to month expenditure releases are highly variable for both priority and non-priority Ministries. * Monthly expenditure patterns across Ministries are not synchronized, possibly reflecting lumpy procurements. * Single month releases can claim a significant of the total annual budget allocation to a particular Ministry. For example, in the case of the Ministry of Water the budget release in March was higher than the budgeted amount for the whole year for the particular Ministry. * From the mission's discussions with sector Ministries and local authorities, it appears that the variation in monthly releases does not necessarily reflect the Ministries' financial requirements. This indicates some scope for improved management of budgetary releases across Ministries, even within the limits imposed by the cash budget management system. * Ministries smooth volatility in monthly releases to a certain extent through the use of supplier credit and accumulation of arrears. These are typically settled once higher releases than budgeted are received. 23 2.36 Figure 3 shows the ratio of actual to budgeted expenditure releases in the education and health sectors at the Ministerial, regional, and district level. The education sector benefited more from additional resources than the health sector. For both sectors, the regional levels received the biggest increases compared to budgeted amounts, while the Ministerial level benefited least from additional exchequer releases compared to the budget estimates. Figure 3: Ratio of Actual to Estimates for Other Charges - Education and Health Sectors Ieaith Sector Expencitures Education Sector Expenditures 400.0 FY9I 500.0 FY9Q1] 30. - -- -- --- --- gFY9902 40I .. F. r. Y99Q2i 40000.040.0 300.0-- FY9902 W 300I_ FY99Q21 200.0 - FY99Q3 3 FY99Q3 200.02000 100.0 0 FY99Q4 FY99Q4 S1000 .1~ 0 FYOOQ1~EFQQ MoH Regions Districts a FY00Q2 MoEC Regions Dstricts FYOOQ2 24 Figure 4: Prioritv Ministries - Ratio of Actual to Estimates for Other Charges: 300% -- - - - - -350% - -- 300% --- -- ----__- - 200% --------- ---- - - -- --- - ---- 250% - - -- - - 200%, 150%- - - - - --- - 100% - -00% - - -- - -- 50% 50% 0% ,.,. ,., , ,0,00% -... Total (excl. Finance and Road Fund)! - - - - Total (excl. Finance and Road Fund) -- Ministry of Health Ministry of Education 600% - - 500% 1400%0- 1200% 400% - 0 800% -. cc.~ 600%- - 200%400% ---- - - - -0 - 00% - -- a - An -- % - -- - - -Z 10% - - Total (excl. Finance and Road Fund) -... Total (excl. Finance and Road Fund) Ministry ofAgriculture and Co-operatiNes, Ministry of Water 700% 400% - ---- - - - - - -.............. 600% 350% ------- - -- ------ 500% - - ---300% - - - -- - -- - --- 500% i 30 400% 250%---- - 400% 200% - - 300% --%- - 150% 200% ¯ T ¯100% -___ -__-___ -__ ----_____-__ -___ -__---__ 100% I- - A --- -- - .- 50I- -- --o--- - - - 0% , % -Total (excl. Finance and Road Fund) - -- --. Total (excl. Finance and Road Fund) Regions Local Goemment 25 Figure 5: Non-Priority Ministries - Ratio of Actual to Estimates for Other Charges: 2000/. 200% A A 150%- ~ 150% - N4_ 100% 10.0% A-S %0% 50%. 0% - ,,0%o ... Total (excl. Finance and Road Fund) ... Total (excl. Finance and Road Fund) President's Office and Cabinet Secretariat Ministry of Foreign Affairs & itg Co-operation 200% 250% 150% --_______________________ 20(N 100% -Q i ~100% '' 50 E I E -0 50% 0% 0% '~a 0 , cl z CI -' z~- 0 2 .. Total (excl. Finance and Road Fund)' F ,&--- Total (excl. Finance and Road Fund) Defence ~Ministy of Science, Tech,& Higher Education 2.5. OPERATIONAL EFFICIENCY - FINDIN4GS OF THE COMPTROLLER AND AuDITOR GENERAL Introduction 2.37 The analysis of the extent of compliance to prudential budget management procedures and regulations by the Government was undertaken as one of the key objectives of the PER99 evaluative work. The analysis was based on information collected from the Controller and Auditor General's (CAG) reports for the FY94 - FY97 and discussions with the Office of the Controller and Auditor General (OCAG), interviews with a sample of central government vote holders and local government officials, and from a meeting involving a cross section of stakeholders. The PER FY00 updates the PER99 analysis, based on information from the FY98 CAG reports for the central government and local authorities. 2.38 As for PER99, the analysis of the CAG reports is intended to: establish the prevalence of qualified or adverse audit opinions issued by CAG; identify the main causes of these unfavorable audit opinions; assess the extent of responsiveness to audit 26 queries and follow up action by vote holders; and analyze and explain the patterns for excess spending or under-funding of votes. Main Findings 2.39 Audit certificates of accounts and statements issued by CAG continued to be predominantly adverse although there was some improvement in FY98 for ministries (Table 1). For regions and local governments the state of the accounts deteriorated tremendously in FY98 with none of the regions receiving a clean certificate and the majority of local governments receiving adverse opinions and qualified certificates. Whereas qualified opinions indicate some points of objection by CAG, the accounts receiving adverse opinion are deemed not to represent a true and fair status of the respective votes. As noted in the PER99, the votes which received adverse certificates had major errors in their accounts and statements submitted for audit, and did not have the required bank reconciliation statements to support the appropriation accounts. 2.40 In FY98, 46 percent of the ministries' accounts received adverse opinion, 12 percent received qualified certificate, while 42 percent received clean certificate (Table Al). Thus, 54 percent of the ministries' accounts received qualified certificate and adverse opinion, showing a slight improvement compared to an average of 60 percent for the period FY94 - FY97. All (100 percent) accounts of the regional governments received adverse opinion in FY98, signaling a significant deterioration compared to the average of 67 percent during FY94 - FY97. During FY98 114 final accounts of local authorities were audited, 2 of which were for FY97 and 1 for FY96. 60 percent of these accounts were declared adverse, 19 percent received qualified certificates, while only 21 percent were pronounced clean. The share of district council accounts receiving an adverse opinion was 63 percent and higher than the share of urban councils receiving an adverse opinion(42 percent). This may point towards greater capacity constraints in district councils. Overall the status of the local government accounts worsened in FY98, with 79 percent of the audited statements receiving either a qualified or adverse opinion in FY98 compared to an average of 76 percent for FY94 - FY97. As PER99 well noted, the worsening of the trend in the quality of certificates issued by CAG to regions and local governments signifies the continued prevalence of the underlying problems of budget management more generally and accounting problems more specifically. 2.41 The FY98 was also marked by the continued prevalence of expenditures that are not vouched or improperly vouched. However, incidences of unvouched expenditures decreased slightly in FY98 while those of improperly vouched expenditures increased. Improperly vouched expenditures increased from 3.7 percent of total in FY94 to 6.8 percent in FY98 while unvouched expenditures decreased from 1.9 percent of total in FY94 to 1.06 percent in FY98 (Table 2). Overall, the share of non-vouched and improperly vouched expenditures out of the total, rose to 8.8 percent in FY98 from 5.5 percent in FY94. Absence of payment vouchers and other documentary evidence to substantiate the authenticity of expenditures was cited by CAG to be the major reason behind this rise. 2.42 Widespread incidences of embezzlement of cash and stores remained high and continued to raise concern in FY98. The magnitude of cash and stores losses decreased slightly from 0.26 percent of total expenditure in FY97 to 0.15 percent in FY98 (Table 3). 27 Embezzlement of cash and stores remain high mainly on account of non-production or non-completion of bank reconciliation statements and poor procurement and stores management. 2.43 Weak controls, extra budgetary expenditures and irregularities have been observed to be the main causes behind poor certification and losses (PER99). In particular, the immediate and underlying causes for the most frequent audit queries are noted to include: incidences of excess votes; failure by the accounting officers to reconcile bank accounts; inadequate supporting documentation of expenditures; failure to follow approved procurement procedures; and failure of purchasing units to account for purchases, and cash and store losses. Dishonesty and lack of technical manpower capacity especially in the ranks of accountants and auditors constrains the effort to reduce audit queries. 2.44 Excess spending increased in FY98, but overall they were significantly lower than savings. Excess spending occurs in specific votes and is either a result of additional spending on a line item in excess of the budget allocation or unauthorized reallocations across specific line items. As noted in PER99, the problem of excess spending appears not to be widespread and has been put under control through the strict application of the cash budget system. The magnitude of excesses have been relatively low except for FY96, which had a budget overrun due to funding of the general elections (Table 4). Saving or "surplus" problems continued to be much more widespread and more pronounced for development than the recurrent budgets. Expenditure saving slightly declined for recurrent budget but significantly increased for development budget during FY98 compared to FY97. Reasons for the occurrence of savings or surpluses include: unrealistic estimates; projects, which face poor implementation due to under-funding or other implementation bottlenecks; unrecorded expenditures; non-recording or non- charging of aid expenditure for some projects to the accounts hence making it appear as savings against the appropriate estimated provision; and failure to fully account for aid received in the form of goods, materials and equipment (PER999). 2.45 The response to CAG's audit queries improved slightly for the ministries but worsened for the regions in FY98. As for the period FY94 - FY97, satisfactory replies and subsequent redress by vote holders to queries from OCAG continued to be a very small proportion of the total queries issued in FY98. On average, only about 13 percent of queries issued were replied to in FY98, a slight increase over the period FY94-FY97 when an average of 10 percent of issued queries were replied to (Table 5). This suggests that little or no action seems to have been taken by accounting officers to rectify the recurring weaknesses in expenditure control and other compliance issues. The implication of this situation is that in many cases the proper utilization of public funds can not be ascertained, and unless the offenders are sanctioned, little or no improvement will be recorded. However, as noted in PER99 a major cause of non-responsiveness to the CAG's queries is the absence of the will to enforce accountability and a lack of appropriate legal instruments for enforcement. The review of the Exchequer Ordinance is expected to provide for more effective enforcement of compliance to audit disclosures. However, the law itself may not be sufficient, unless it is accompanied by a change in the operative culture to more accountable and transparent behavior in the civil service and by bringing such accountability increasingly into the public domain. Involvement of the 28 press, donors, political institutions, and non-governmental organizations in the review of public expenditure effectiveness will serve as strong stimulants of prudence and accountable behavior. 2.6 ASSESSMENT OF INSTITUTIONS FOR IMPROVED BUDGET PERFORMANCE 2.46 Expenditure management and public sector performance at the three levels of budget performance is critically influenced by the institutional arrangements and processes used for budgeting and expenditure management. This section discusses some of the key institutional arrangements underlying public finance management and provides a brief overview of recent initiatives to strengthen the institutional framework for public finance management. Table 15 provides an overview of institutional arrangements that affect public finance performance. In addition to institutional arrangements affecting directly public finance management (shown in column one of table 15), accountability and transparency are the other key ingredients to ensure improved public finance performance. Table 2.15: Key Institutional Arrangement and Expenditure Outcomes Institutional arrangements Accountability Transparency I. Aggregate Fiscal Discipline A. Macro framework and Ex-post reconciliation Published coordination mechanisms Sanctions Made Public B. Dominance of central ministries Openness of financial markets Freedom of the press C. Formal constraints D. Hard budget constraints E. Comprehensiveness of budget II. Prioritization A. Forward estimates Reporting on outcomes Published B. Comprehensiveness of the budget Ex-post evaluations Freedom of the press C. Flexibility of line agencies Hard budget constraints Made public D. Breadth of consultations Technical capacity of parliament Comprehensible E. Use of objective criteria Ill. Technical Efficiency A. Civil service pay and merit-based Clarity of purpose/task Published recruitment/promotion Chief executive tenure Made public B. Managerial autonomy of line Financial accounts, audits Freedom of the press agencies Client surveys C. Predictability of resource flow Contestability in service Delivery Source: Ed Campos, Sanjay Pradhan, "Budgetary Institutions and Expenditure Outcomes - Binding Governments to Fiscal Performance" Policy Research Working Paper 1646, The World Bank, September 1996 2.47 At the aggregate level, the institutional set up is currently dominated by the cash budget management system, which gives overriding power to the Ministry of Finance and the Central Bank to establish monthly aggregate expenditure levels and enforce a hard budget constraint. However, the cash budget management system imposes significant costs in the form of reduced operational efficiency and will need to be replaced by more flexible and robust mechanisms which can support improved efficiency and service delivery capacity while ensuring aggregate fiscal discipline. However, it is widely accepted that the relaxation of the cash budget system will be gradual to avoid the recurrence of large fiscal imbalances. Such a gradual approach could involve the move to a quarterly commitment system as well as the relaxation of the cash budget constraints 29 for MDAs that are part of the performance management pilot. As the cash budget system is relaxed, the Medium Term Expenditure Framework will gain even greater significance as it provides a three year macro framework for estimating resource availability from both domestic and foreign sources and to coordinate expenditure planning and management. While the cash budget system limits the benefits of a MTEF approach, the use of the MTEF since FY99 nonetheless has already led to improvements in budgetary planning and allocations. Equally important, its introduction while the cash budget is still in place provides the opportunity for learning by doing with limited risks and will thus facilitate the eventual move away from the cash budget system. 2.48 At the level of strategic allocations, the PER/MTEF process provides a framework for wider participation in the budgeting process. Government has opened up the process to provide the opportunity for various stakeholders to provide inputs to the process of making strategic allocations. At present, the allocation process is heavily influenced by donors through the MDF and HIPC conditionalities. However, the goal should be to further strengthen domestic participation in the allocation process to ensure that local priorities are catered to and that poverty is addressed in an effective way. Limited technical capacity both in the executive arm of Government as well as in Parliament limits the application of objective criteria in the allocation process. However, it is expected that training provided in the framework of the MTEF as well as support by local research institutes and external consultants in the preparation of Public Expenditure Reviews will lead to strengthened capacities in this area. 2.49 Institutional problems at the level of operational efficiency are still severe and limit effective service delivery. Efforts under the Public Sector Reform Program are intended to overcome some of these institutional bottlenecks. However, it is also necessary that these bottlenecks are taken into account during the process of budgetary planning and that Government refrains from undertaking activities before institutional and human resource constraints are reduced. 2.50 In the following section we provide an overview of the status of various initiatives that are intended to improve the institutional framework for budget management in Tanzania. Strengthening Financial Management and Accountability 2.51 The PER process is now focusing on raising and monitoring the efficacy of the public expenditure after having achieved some significant success in promoting greater focus on priority sectors as well as OC in budget allocations. Emphasis is being placed on rolling out the Integrated Financial Management Systems to widen coverage; introduction and widening the adoption of Performance Budgeting; strengthening the public audit system, follow ups and public disclosure; and implementation of performance improvement plans under the Public Service Reform Program. These measures will be buttressed by the amendment of the Exchequer Ordinance, splitting it into two acts, the Financial Management Act and the Public Audit Act. 30 Computerized Financial Accounting System 2.52 An Integrated Financial Management System (Platinum) has been introduced to all Ministries. In addition, the IFMS has also been introduced in TRA and 19 TRA offices and sub-treasuries in the districts. While Ministries are connected on-line to the central Platinum server through a wide area network (WAN), the 19 remote sites exchange data with the center through a dial-up network. 2.53 It is also planned to implement in a phased manner a new Financial Management and Accounting Framework based on Platinum SQL for all Local Government Councils. Preparation for implementation is currently underway in 28 Councils. 2.54 Training in the use of the IFMS has been provided to staff in the Ministries and districts, as well as to staff in the Office of the Controller and Auditor General. 2.55 The Budget Manager module of the Platinum system also allows for multi-year budgets, profiling year 1 by month (or quarter) and years 2 and 3 in total, which allows for the eventual integration of the Medium Term Expenditure Framework into the computerized IFMS. In addition, the coding of expenditures and revenues in the new chart of accounts already includes codes for objectives, targets, and activities, in order to make the IFMS compatible with the introduction of performance budgeting. 2.56 It is foreseen that starting July 1, 2001 only IFMS is used as government budgeting, accounting, and financial information system, with no fiscal transactions taking place outside the IFMS. Creating the Legal Framework for Improved Public Finance Management 2.57 A new accounting circular was issued in July 1999 to enable the use of the IFMS and cash budget management. In light of the ongoing reforms, the Exchequer Ordinance that currently provides the legal basis for public finance management has become inadequate. To further streamline public finance management and to create the legal basis for new public finance management approaches, two new bills, the Public Audit Bill and the Public Finance Management Bill will be tabled in Parliament during its June 2000 session. Implementing regulations will be issued in August 2000. The new legislation will also entail improvements in the framework for public procurement. Performance Budgeting 2.58 Performance budgeting was introduced to seven ministries in 1998 on a pilot basis. In 1999, the pilot was extended and performance budgets were prepared by all Ministries in 1999. A review of the experience with performance budgeting yielded the following main conclusions:4 * Most spending agencies did not adhere to the set ceilings. Only eleven (11) ministries out of twenty-five (25) and one (1) independent department out of sixteenth (16), adhered to the set ceilings. This shows a weakness of prioritization of targets. Report on the Performance Budgeting Evaluation Workshop, held at Bahari Beach Hotel from 2-3 August. 1999 31 * Most spending agencies did not prioritize their objectives and its justification as required. * Lack of clarity and consistency of objectives, policies/strategies and targets. * Shortfalls in the budget guidelines for FY00 regarding PE ceilings of parastatals which were not separated from ministerial "OC". * It is clear that the conceptual framework of performance budget has taken root. * The technical side of performance budgeting through target tables was generally stronger than the planning side through a strategic framework. The weakest area being that of presenting the objectives in priority and annual targets as well as identification of activities. * There is a lack of clarity and sequence of thinking from general to particular and vice versa. i.e. the link between the strategic framework, 3 year targets and annual targets is lacking. * There is inadequate integration of personnel dealing with the planning and budgetary parts of performance budgeting, (i.e., personnel dealing with PE preparation and OC/Planning). 2.59 In order to facilitate performance budgeting in the coming years, GoT issued in August 1999, a performance budgeting operations manual, which provides detailed instructions on the process and technical requirements for preparing a performance budget as well as the framework for monitoring and reviewing the performance budget. 2.60 Performance auditing would be a logical complement to the introduction of performance budgeting. Although the Office of the Controller and Auditor General is eager to expand its audits to cover this new area, the OCAG currently lacks resources, manpower, and skills to carry out such audits effectively. Donor Coordination 2.61 Tanzania is one of the main recipients of external assistance in Sub-Saharan Africa. On average Tanzania receives about US$ 900 million per year from external sources. This amount is slightly over 10 percent of GDP. However, not all of the inflows pass through the exchequer system to support the Government budget. It is estimated that about 70 percent of such external resources go directly to the projects supported by donors. 2.62 Every donor has different processes and strategies of channeling the resources to the targeted projects. The multiplicity of these has made donor coordination a tedious one requiring more capacity at the Ministry of Finance. Donors have different accounting systems, different disbursement modalities and different financial years. To harmonize the multiplicity of the donor accounting systems, there are plans to integrate donor facilities in the new Integrated Financial Management System (IFMS) using the Platinum software. 2.63 In addition, the Government is now taking the lead in preparing a country assistance strategy referred to as Tanzania Assistance Strategy (TAS). This is a broad based framework which encompasses all the donor interventions in the country in a coordinated manner. In such an endeavor, the Government will list its priorities, take 32 stock of its domestic resource envelope to determine the resource gap which then can form the basis for negotiations with donors. 2.64 Another promising approach to ensure greater integration of donor resources into overall government programs is the development of sector development programs and basket funding arrangements. Sector development programs have been developed for the roads and the health sector and are under preparation for the education sector. Basket funding arrangements support the strengthening of the TRA as well as the implementation of the Local Government Reform Program. Reducing Corruption 2.65 Corruption in various forms and at various levels of Government is a major obstacle to achieving operational efficiency in the delivery of public services. In order to reduce corruption, Government under the leadership of the Prevention of Corruption Bureau (PCB) has developed a comprehensive anti-corruption strategy, which is currently in the process of being operationalized and will be implemented over the coming years. Strengthening the Office of the Comptroller and Auditor General 2.66 The Office of the Comptroller and Auditor General (OCAG) plays a key role in ensuring accountability for the use of public resources in Tanzania. In FY00, the OCAG has received a significant increase in budgetary resources which allowed an acceleration in the audit process. The audit report for the financial year FY98 has been published with less delay (15 months after the end of the financial year) than in previous years and there was a significant reduction in the backlog of audits of local Governments. The main issue is now on the effective follow-up to the OCAG report. This must entail both effective prosecution and sanctions for problems identified by the OCAG and the implementation of measures that prevent the recurrence of problems highlighted by the OCAG. 33 2.7 ROAD FUND MANAGEMENT Background 2.67 The roads sector is one of the central sectors in the Tanzania economy and is crucial for the sustainability of the country's economic development. The road sector handles about 70 percent of internal freight, 64 percent of transit cargo and is a major mode of passenger transport. The strategic nature of the sector has made the Government of Tanzania accord it and other infrastructure investments a high priority. The Tanzania Vision 2025 considers the development of the road network absolutely essential for promoting development, particularly rural development. 2.68 The administration of the road network falls under two separate ministries. The Ministry of Works (MOW) which administers trunk and regional roads, and the Ministry of Regional Administration and Local Governments (MRALG) which, through local authorities administers district, urban and feeder roads. The management of trunk road construction, rehabilitation, and maintenance is, from February 2000, managed by an executive road agency - TANROADS. In terms of financing of upgrading, rehabilitation and maintenance there is participation of both the Government and donors at all levels of the sector. There is also the participation of the private sector and communities in road maintenance. The main source of finance for maintenance and operations is the Road Fund, which is funded from as a fuel user charge and shared at the ratio of 70:30 between WOW and MRALG. The focus of this section of the report is to assess the effectiveness in the management of the Road Fund. Establishment of the Road Fund 2.69 The Road Fund was established after the approval of the Amendment No.2 to the 1985 Road Tolls Act on December 23, 1998. This is the fund "into which shall be paid all monies collected as roads toll imposed on diesel and petrol, transit fees, heavy vehicle licenses, vehicle overloading fees, or any other source at the rate or rates to be determined by Parliament from time to time." The amendment vested the administration of the Road Fund to the Road Fund Board, to be composed of a Chairman and eight members, four of them representing the private sector. The Road Fund Board was officially inaugurated on August 27, 1999, after which it organized the Secretariat, including the appointments of TANROADS Chief Executive in November 1999 and Road Fund manager and accountant in January 2000. There are several pertinent issues that need to be considered as the Government gears toward ensuring that more resources are availed for funding road rehabilitation and maintenance. Key Issues on Road Fund Management Sources of Roads Fund Revenue 2.70 Before the amendment of the Road Tolls Act of 1985, fuel levy was the only source of revenue for the Road Fund. Although the Road Tolls Act was amended two years ago to include in the Road Fund more sources of revenue, so far these additional 34 sources have not contributed to the fund. The proceeds of these sources have instead been allocated by the Treasury to other expenditures. Table 16 shows the amounts of revenue collected from transit fees, heavy vehicle license fees and vehicle overloading fees, which were not deposited in the road fund account. Table 2.16: Revenue Collected by Treasury but not included in the Road Fund (Tsh. million) Revenue Source FY98 FY99 FYOO* Transit fees 624 800 9%q Heavy vehicle license fees 652 604 0.6 Vehicle overloading fees 1014 658 15.0 TOTAL 2290 2062 1635 * Up to December 1999. Source: Louis Berger S.A (2000) - PER study on Tracking of the Roads Fund The Fuel Levy rate 2.71 There is also concern about the rate of the fuel levy. The levy was Tsh. 7 per liter in 1991 but was raised to Tsh. 70 per liter in July 1998, and has remained at that level to date. In real terms, the rate has actually declined and may not be serving well the intended purpose. Expressed in US dollars, for example, the rate varied between 2.0 cents in early 1992 and 10.6 cents in late 1998. Since this peak, the rate did not follow the depreciation of the shilling and now represents only 8.8 cents (Louis Berger S.A, 2000 - PER study on Tracking of the Roads Fund). Aside from administrative problems related to tax evasion due to illegal fuel business, the fixed nature of the rate of fuel levy in nominal terms explains why the road fund revenue has been almost stagnant over time (Table 17) and declined in real terms. Table 2.17: Road Fund (fuel levy) Collection, FY97 - FY00 (Tsh. Million) FY97 FY98 FY99 FY00* Road Fund (Total fuel levy collected) 33936 36703 38395 25898 * Up to December 1999. Estimated collection for FY00 is Ths. 38,847 million. Source: Louis Berger S.A (2000)- PER study on Tracking of the Roads Fund Revenue Collection and Releases of Road Fund 2.72 The Road Fund collection and release procedure is as follows: first, the amounts collected by the Tanzania Revenue Authority (TRA) in the Dar es Salaam region are deposited directly into the Road Fund Collection account at the Bank of Tanzania (BOT), while the amounts collected in the remaining 19 regions are banked in commercial banks and eventually transferred to the Pay Master General (PMG) account at BOT. Second, the releases of revenue from the PMG account to the Road Fund Collection account, and from the Road Fund Collection account to the MOW Road Fund account and MRALG Road Fund account depend on the directives of the PMG/Permanent Secretary in the Ministry of Finance. Third, the releases of revenue from the MOW Road Fund account to regional engineers' accounts at NMB and from MRALG Road Fund account to the 35 District Councils' accounts at NMB are done under the directive of the accounting officers in the respective ministries. 2.73 Although the procedure above is very clear, in practice there has been a problem of non-release or shortfalls in the release of funds by the Treasury. During FY97 to FY99, for example, a total of Tsh. 109,034 million was collected as fuel levy, but out of this only Tsh. 81,946 million were actually released by Treasury to MOW and MRALG. The balance of Tsh. 27,088 millions or 24.8 percent of total collection, which represents almost one year of collection, was not transferred to the respective ministries. In FY00 the untransferred balance stood at Ths. 9,108 million or 35.2 percent of total collection as of December 1999. This makes total untransferred collection during FY97 to December 1999 stand at Tsh. 36,196 million. Although the Government has promised to remit the outstanding untransferred balance before the next financial year, the withholding or delay in releasing these funds must have had implications in terms of the delays in road works implementation and payment of various contractors. 2.74 There were also problems related to the distribution and timing of the releases of road fund revenue. Results of the tracking study of the Road Fund indicate that the distribution ratios between the two ministries (MOW and MRALG) were not respected in FY97 and FY98. During these two years MOW received 82.26 percent and 84.8 percent respectively, instead of the scheduled 80 percent. However, the 70:30 ratio has been respected since FY99. It is also noted that in FY97 there was no release during the first quarter of the fiscal year and at the end of the second quarter only 31.25 percent of the annual total was released. In FY98 the situation improved mainly because of a major release on July 10, 1997. However, only 46.9 of the annual total was released at the end of the first two quarters. Basic Problems of the Fuel Levy Collection Process and Recommendations to Improve the Process 2.75 Two basic problems are noted as regards fuel levy collection process. The problems are: first, the process is complicated with too many entities involved and long transit time for the funds in the banking system. Significant interest earnings are lost during this process. The other problem is that the time taken by the whole process is quite long and under the full control of the Permanent Secretary - Treasury, which makes the time of the release quite unpredictable. This results in serious cash flow problems during the implementation of the road maintenance contracts. 2.76 The following suggestions would help improve the collection process and revenues collected. First, the Road Fund Board should enter into formal agreements with each agency in charge of collecting a given type of road toll/levy for the transfer of the funds collected on a regular and guarantied basis. Second, TRA should transfer the fuel levy directly to the Road Fund Board account without going though the Treasury which will receive all corresponding information on the movements of funds. Third. The Road Fund Board should arrange to receive the funds from TRA in the regions in order to be able to secure and maximize any interest generated between the time of collection and of expenditure of the funds. Fourth, the overload fines should be centralized on the Roads Fund account as soon as collected by the Weigh Bridge units. Lastly, the fuel levy should be increased whenever there is a significant depreciation of the shilling, so as to offset the 36 impact of the depreciation on real Road Fund revenue. In the short term, this could be achieved without increasing the total fuel retail price by reallocating the taxes collected on fuel between TPDC, TIPER, energy fund, excise duty and road toll in order to increase the share of the later at the expense of some others. 37  3. SYSTEMIC FISCAL ISSUES 3.1 THE PLIGHT OF THE DEVELOPMENT BUDGET 3.1 Budget analytical work done under the public expenditure review process (PER) for FY98 and FY99 revealed a number of disturbing features of the development budget in Tanzania. First, there is a significant divergence between commitments and disbursements and within the fiscal year releases of funds are erratic constraining proper planning of commitments. Generally actual disbursements are much less than what was originally provided for. The divergence is marginally higher for the foreign financing component (55% - 95%) than for the local component (49% -98%). The divergence is also higher for the regions (52% - 89%) than for the ministries (23% - 85%). There is also a wide divergence between budgeted and disbursed amounts partly due to lack of counter-part funding. Chart 3: Actual Development Expenditure (% of Budget) Chart I Actual Developm ent Expenditure (% of Budget) 40 0 3 5 0 .. . . .. 30 0 -- - - - - -M nm,-rretDep-rnc.nt M inistriesiDeps & Regions 10 0 - 5 0 1995/96 1996/97 997/98 1998/99 Years 3.2 Data on actual development expenditure of regions for FY96-FY99 as a proportion of total development expenditure shows that its share is not only small and erratic (annual average of 8.6 percent of total development expenditure) but also declined from 13.0 percent for FY96 to only 5.1 percent in FY97, only to recover partly to 9.9 percent by FY99 probably reflecting the recent decentralization drive. In addition, most regions did not receive any funds for development expenditure during the first 8 months of FY00 and delays of up to 6 months were experienced in FY99 and the releases were sporadic hampering planning of commitments. In terms of regional distribution, analysis of available data also suggests a skewed distribution of the development budget partly 38 reflecting donor preferences in selecting geographic areas of operation. For example, over the period FY96-FY99, four regions (Mara, Kagera, Rukwa and Mwanza) alone accounted for about 61.1 percent of the annual development expenditure by region. 3.3 Analysis of the development budgets and actual outturns by source of funding (local or foreign) shows that the development budget is heavily donor-funded to the tune of very close to 80 percent. This reliance on foreign financing has also been increasing in recent years from 58.8 percent in FY96 to 91.9 percent in FY99 coinciding with the period of applying the cash budget system focused on the recurrent budget. In addition, it is also apparent that there are fairly wide divergences between the budgeted amount (proxy for commitments) and actual outturn (proxy for disbursements) both by donors and government. The experience of the last four years suggest that overall, development expenditure has been off-budget by an average of 73 percent. Generally the foreign component exhibits a higher variance (79.6 percent off-budget) compared to the local component which has on average been off-budget by 67 percent. 3.4 Variations of development expenditures within the fiscal year are also very significant and move closely with the releases of foreign 100% finance. Quarterly development expenditures 80_/_ reflect closely the pattern observed for 6Y development grants and concessional loans, with most of the expenditure being recorded 2 99 either in the second or fourth quarter. Tis 0%L 01 02 Q3 04 probably reflects the end of the fiscal year of I donors as mentioned before, and associated disbursement and reporting requirements. No separate data are available to allow the breakdown of development expenditure into domestically and foreign financed components. However, the share financed from domestic resources is typically small and closely linked to foreign financed expenditures, usually in the form of counterpart funding. 3.5 Second, the development budget is characterized by a preponderance of extra budgetary financing particularly at regional and local government levels. Interviews with the Coast region officials, for example, revealed that there is a wide variation of modes for supporting development activities. One category of donors channels the funds through the regional office. The second category of donors sends finance directly to the districts or to the district council through the ministry responsible; while the third category bypasses the concerned ministry, region and district authorities by sending money directly to the projects which they implement with the help of project management units. Still other donors channel resources directly to the bank accounts of groups (e.g. women) implementing a project. 3.6 The third issue relates to inadequate provision of counter-part funding which is needed to trigger committed finance of development projects especially by the multilateral institutions. The issue of counterpart funding relates to the requirement by donors that the Government makes available some resources to complement and trigger committed donor finance of development projects. This applies more so for multilateral donors, as most bilateral donors do not have the counter-part funding requirement. However, the level of counterpart funding requirement varies across donors ranging from 39 5 - 15 percent. One problem is that the basis of such levels is not quite apparent. But an even greater problem is that the Government has been unable to provide for the counterpart funds thereby inducing delays in donor disbursements or non-disbursement altogether. A reduction of the magnitude of counterpart funding requirement and a gradual shift towards generalized budget support will certainly help alleviate the problem of disbursement. However, this requires a solid financial management system to be in place to obviate the need for tight donor controls of development project financing. 3.7 The fourth issue relates to problems in the development budget process and weaknesses in implementation capacity. The development budget process is thwarted by numerous problems as identified in a study commissioned by the PER Working Group: (i) The number of institutions involved in determining the budget is large and the process operates at different levels right from the central ministries through line ministries, to the local governments, communities and specific enclave projects. (ii) The guidelines for the preparation of the Medium Term Plan and Expenditure Framework do not provide sufficient guidance for prioritization in the development budget. Delays in issuance of the Budget Guidelines put strain on those responsible for preparing ministerial budgets. The Budget Guidelines also do not show how the ceilings for this component of the budget are arrived at, as most of it is based on guess work on what level and type of support is likely to emerge. Compliance to the BG themselves is not observed, again partly due to the high level of uncertainty of financing. (iii) There are capacity constraints in the institutions concerned (planning units in ministries and the budget division in MoF and local authorities) which cause delays in project execution and unclear assessments of what is intended for a given period. The capacity problems also affect success in project implementation due to weaknesses in design; project management and monitoring of implementation, especially at the local government level. (iv) A more serious implementation problem relates to weaknesses in the procurement system, which holds up progress in implementation. This problem is particularly acute in the roads sector. The capacity of handling procurement is weak partly because a significant number of supplies officers were trained a long time ago and their skill profiles have not evolved with the changing requirements of modem procurement systems. Moreover, there are weaknesses in the procurement law, which hamper transparency and prudence. These weaknesses are now being addressed under a proposed amendment to the law. (v)There are also problems of coordination between the roles of MoF and PLANCOM especially on sectoral issues. Since sector specialists in PLANCOM were not transferred to MoF, with the shift in the responsibility for this component of the budget, sector issues are not adequately addressed partly because the limited capacity in MoF tends to be pre- occupied with the recurrent budget. The criteria used in selecting development projects in the budget is also not transparent. There are also problems of integration between the central government and local government budgeting that is still evolving. 40 3.2 DESIRABLE LEVEL OF REVENUE MOBILIZATION 3.8 In determining the desirable level and the modalities of domestic revenue mobilization the Government typically has to strike a balance between meeting demands for higher public expenditure, and therefore higher revenue mobilization, and lower taxation of private incomes. Tanzania has a relatively low tax revenue-GDP ratio, which lies considerably below the average for Sub-Saharan Africa of 16.4 percent. Estimates indicate that the revenue potential of the Tanzanian economy might be currently six to nine percentage points higher than what is currently achieved, i.e. between 17 and 20 percent of GDP. However, it is also clearly understood that realizing this revenue potential is an extremely tedious and slow process, which is likely to take a considerable number of years to achieve. 3.9 The demand for higher revenue mobilization comes from the severe under- funding of basic social services such as primary health and education and of physical infrastructure services, which have been identified as being essential to economic growth and progress in sustainable human development. It also arises from the desire for greater self-financing and low donor dependence in the longer term. The key arguments for increasing revenue would thus be that it would have high payoffs in terms of facilitating growth and reducing poverty on a sustainable basis. The argument for higher revenue is also closely intertwined with the provision of foreign aid by donors and the issue of unsustainable aid intensity. A central assumption underlying most donor assistance is that their resources are additional to whatever funds can be mobilized efficiently domestically, rather than substituting for domestic revenue. As a result of the decision to protect expenditure to social sectors, the share of expenditure allocated to these sectors as a percentage of discretionary expenditure has shown an upward trend in recent years, rising from 17.1 percent in FY96 to 22.2 percent and 24.7 percent in FY97 and FY98, respectively. This increase has been realized largely on account of increased donor support. The important issue here is that a permanent solution to the problem of under- funding of government operations cannot be found in ever increasing but only in increased domestic resource mobilization and their efficient use. Further reductions in tax exemptions, rationalization of the tax regime and improvement in tax administration to curb tax evasion are some of the important measures that are required to help broaden the tax base and increase tax revenue. 3.10 On the other hand there are costs to large transfers of private resources to government. The cost of higher revenue mobilization in this regard are two-fold. Firstly, taxation withdraws resources from the private sector and households and thus has significant opportunity costs. Secondly, taxation may introduce inefficiencies into the incentive system of an economy. 3.11 When the tax burden falls on a narrow base, those shouldering such a burden disproportionately will be aggrieved leading to poor compliance. The issue of the withdrawal of resources from the private sector is accentuated by the fact that in Tanzania the easily accessible tax base is relatively small and tax evasion wide spread, which increases the tax burden on the few tax payers. To provide a comparative view of the tax burden faced by the businesses we present some information on the marginal effective tax rates (METR), as shown in a recent World Bank study on Uganda, Kenya, and 41 Tanzania. The METR in effect measures the impact of the tax regime on the net business profit and activity. The study distinguishes between the effects on the cost of capital and on the cost of production. Overall Tanzania's METR for the manufacturing sector's cost of capital, at 40 percent, is the highest in East Africa (Kenya 28.8 percent and Uganda 33.8 percent). Taxes on machinery, inventories and land are particularly high. In the case of tourism, Tanzania's METR on capital and cost of production for foreign firms lies significantly above Kenya's, the main competitor but below that for Uganda. The higher METR for manufacturing leads to the frequent expressions by manufacturers of an overly high tax burden. The key challenge in this area is thus to increase tax revenue without increasing the METR. This calls for a need to broaden the tax base and reduce tax evasion as well as exemptions. Table 3.1: Marginal Effective Tax Rate on Capital for Foreign Firms (Applying Uganda's Non-Tax Parameters to Kenya and Tanzania) Uganda Kenya Tanzania Manufacturing Buildings 38.9 1.9 25.6 Machinery -3.9 12.3 31.0 Inventory 59.0 69.0 61.9 Land 32.8 27.5 39.0 Aggregate 33.8 28.8 40.0 Tourism Buildings 36.5 0.9 15.9 Machinery -1.8 10.0 28.5 Inventory 59.0 69.0 61.9 Land 32.8 27.5 39.0 Aggregate 32.6 7.5 21.9 Table 3.2: Marginal Effective Tax Rate Cost of Production for Foreign Firms (Applying Uganda's Non-Tax Parameters to Kenya and Tanzania) Uganda Kenya Tanzania Manufacturing Capital 33.8 28.8 40.0 Labor 10.0 0.1 4.0 Fuel 174.0 62.0 25.4 Overall 30.7 21.5 28.8 Tourism Capital 32.6 7.5 21.9 Labor 10.0 0.1 4.0 Fuel 174.0 62 25.4 Overall 29.9 7.2 17.0 Source: Chen and Reinikka, 1999 3.12 Distortions may arise in the incentive regime due to excessively high taxes. In the past, reform efforts have aimed at reducing these inefficiencies, which have led to a decline in the tax revenue-GDP ratio for many African economies. The focus of many of 42 these reforms was clearly on efficiency without paying sufficient attention to the implications for revenue and public finance. Here the assumption was that either distortionary taxes would be replaced by non-distortionary taxes and thus reforms would be revenue neutral, or could actually increase tax revenue through enhanced compliance as tax rates were reduced. 3.13 It is important to point out that the key factor determining the desirability of domestic resource mobilization efforts has to be the effectiveness and efficiency of public spending. If efficiency is low, it is clearly undesirable to increase resource flows to the public sector, unless it is ensured that increased resource flows are necessary and will lead to increased efficiency in public service delivery. This argument is closely associated with enhanced willingness to pay taxes when quality and quantity of service delivery by the public sector improves. This further strengthens the argument for public sector efficiency as a precondition for increasing resource mobilization. On the other hand, it also cautions against using the budget excessively as an instrument for redistribution, since if the perceived service delivery to those who pay taxes goes down, their willingness to pay taxes may also decline. 3.3 FISCAL RESTRAINT AND CASH BUDGET MANAGEMENT SYSTEM 3.14 The cash budget management system was introduced in FY97 to impose fiscal discipline on the spending units and enforce limits on aggregate spending in line with collected revenue and external aid disbursed through the exchequer system. Since its introduction the GoT has succeeded to inject considerable discipline into the budget process. The cash budget system has also been successful from a macro perspective in the sense that it has by and large managed to curb budget deficits (before and after grants) that were characteristic of the Tanzania budget prior to its introduction, and generated surpluses averaging 1 percent of GDP thereafter. The cash budget system has also facilitated the recent sharp reduction in the rate of inflation from almost 35 percent in 1995 to 6 percent in March 2000. 3.15 However, the cash budget system has also entailed significant costs particularly in the form of unpredictable funding of essential public services leading to wide monthly swings in the funding of government operations to match revenue availability. Commitments against government obligations, apart from the wage bill and debt service, have had to be in a monthly time frame restricting the scope for activity planning. There are particularly large quarterly and monthly variations of the "Other Charges" (OC) which arise from the large variations in releases for this item of expenditure. Personal emoluments and debt service are the first claim, so the brunt of fluctuations in the releases from domestic and disbursement of external aid under the cash budget management system is borne by the other charges. As a result of the unpredictable availability of finance, service delivery in all sectors has been erratic although priority activities within priority social sectors (education, health, water, roads and agriculture) have now been protected. Generally, the capacity of the Government to provide adequate physical infrastructure and to provide all Tanzanians with access to basic social services has been restricted to cash availability with insignificant use of domestic credit to smooth the monthly gaps. The cash budget era has also been marked by failure to respect sectoral and economic allocations as approved by Parliament as expenditure programs 43 were under-funded due to revenue shortfalls. This is particularly manifested in the squeeze on expenditures on other charges especially on materials and supplies, as well as counterpart funds for donor funded development projects. These items have typically been treated as residuals in making cash-based exchequer releases. The consequence has been to impinge upon both allocative efficiency and budget predictability. For the system of performance budget to operate effectively, the predictability of budget allocations will have to improve. 3.16 In order to mitigate some of the negative effects of cash budgeting, borrowing to smooth fluctuations resulting from unpredictable monthly revenue flows is one recourse but the law restricts advances. In the absence of large cash floats such smoothing is limited. Moreover within the month there is a bunching of releases towards the end of each month as these releases are predicated on actual cash availability. With VAT and income tax collections gravitating towards end month due dates, the actual releases follow the same patterns. Given that uncertainty in the final out-turn poses a risk, such temporary deficit financing may be converted to increased stock of indebtedness violating the commitment to reducing it. An issue that has been raised by some observers is whether such a risk is significant given that overall the country has managed to run budget surpluses for three years now and that sustainable fiscal deficit levels are hardly in danger of being violated. 3.17 The Government has also recently allowed a number of Ministries to operate with three-months commitments instead of monthly commitments. This should improve the capacity of these Ministries for rational budget implementation. However, this decision to move to a three months commitment system presupposes that the problems associated with the application of the cash budget are mainly due to volatility in the timing and forecasting of receipts. This timing issue, month to month volatility in receipts and errors in forecast can in principle be dealt with in several other ways, including the adoption of quarterly cycle in place of the monthly cycle or by using short term borrowing, adjustments in one period for the prior's deficit/surplus, and substantive reserve funds to smoothen out spending patterns. Nevertheless, it is also fundamental to consider whether or not the inconsistency and budget slippage in the application of the cash budget system are due to "emergency spending needs", wasteful spending, poor coordination in budget management between the BoT and MoF, or reflect a lack of realism in the budget itself. That is, besides the timing issue it is equally important to ensure that the budget allocations reasonably reflect the true commitments that the Government has undertaken and address other important sources of budget slippage otherwise the problems will persist. The government has therefore to continue not only to cement hard budget safeguards and inject discipline and sanctions into the budget process but also right-size its budget. These can be achieved by implementing a solid MTEF and rigorously apply IFMS to provide a timely and meaningful accounting data. The Ministry of Finance will need to closely watch whether the relaxation of monthly cash budgeting requirements interferes with maintaining overall fiscal discipline and macroeconomic stability. 44 3.4 MACROECONOMIC STABILITY AND DEBT SUSTAINABILITY 3.18 A positive decision has been reached by financiers, which will allow Tanzania accede to the enhanced HIPC relief. The interim relief will be available from the last quarter of FY01 onwards when the Government plans to reach the completion point. Thereafter the full HIPC relief is expected. This change has profound influences both on the resource envelope projections and on the deepening of recent progress in expenditure prioritization, given the poverty-focus of the enhanced HIPC initiative. We focus here on the implications for the size of the resource envelope and the level of aggregate spending. The Government is aware of the continuing evolution of the procedures governing HIPC agreements and used existing guidelines for projecting the MTEF scenarios, aware that adjustments may need to be made. 3.19 The interim HIPC relief, through IDA and IMF grants, will enable the country to free up a sizeable amount of its own resources for servicing multilateral debt ( estimates used in the current MTEF projections are $60 million for FY01 rising to about $110 million after reaching the completion point). The additional relief over that availed under the interim arrangement will be due to reduced debt service for bilateral debt when the Paris Club relief associated with terms for enhanced relief becomes effective after reaching the completion point. Interest on external debt tapers down after FY01. The net effect on expenditure projections from the above relief in combination with increased revenue effort is to raise it from the likely out-turn of 17 percent of GDP for FY00 to 20.3% of GDP in FY03, a full three percentage points of a growing GDP. 3.20 Partly related to the above is a significant change in the projected size of the fiscal deficit to accommodate increased expenditure enabled by the relief and smaller increases in project grants. Given that the HIPC relief will be in the form of budgetary support, long-term, and irrevocable once the completion point is approved, the risks associated with the related expansion of the fiscal deficit (after grants) are not significant. The projected deficit after grants will rise from the projected actual of -0.4 percent in FY00 to -1 4 percent of GDP in FY03. The fiscal deficit before grants will rise to nearly -6 percent over the corresponding period approximately its size in FY95, the increase being fully financed by an increase in external grants and very soft loans. This size of the deficit appears to be sustainable, given the real GDP growth projections ranging between 5 and 6.6 percent for the period and the fairly steady flow of relief from the HIPC arrangement. Barring any major surprises from offsetting large cuts of bilateral aid, this situation is basically sustainable. A sample of donors interviewed during the PER mission confirmed additionally of HIPC support. The section on macroeconomic review deals extensively with the issue of debt sustainability after HIPC, where new borrowing is contracted. This form of financing is basically non inflationary. 3.21 One possible downside effect of this shift in fiscal stance, however, is that it is likely to increase relatively more expenditures on goods and services that are typically not traded internationally, leading to the strengthening of the shilling and reducing the competitiveness of Tanzanian goods. The resultant shift in the relative profitability against producing for export for example would lead to loss in the base for robust growth. The Bank of Tanzania could begin focusing immediately on effective strategies for prudent sterilization against such effects. 45 3.5 CO-EXISTENCE OF OVERALL FISCAL SURPLUS SIDE BY SIDE WITH UNDER- FUNDING OF PRIORITY SECTORS 3.22 There is continued concern over the co-existence of overall fiscal surplus (after grants) side by side with under-funding of priority sectors. The perception is that the Government is putting monies away (building up reserves) and/or availing it to the private sector through the domestic banking system (by reducing its stock of domestic debt with the banking system) while government expenditures and net lending remained around 15.1 percent of GDP for FY97 to FY99. It may be argued that a shift of resources from the budget to the private sector may raise overall effectiveness in the their utilization, if as presumed, the private sector is a better user. However, given the very slow movement of these resources from the banking system to the productive sector, as reflected by loan to deposit ratios ranging between 30 and 50 percent, the shift may not be de facto happening. Moreover a rise in gainful absorption of these resources by the private sector depends also on the absorptive capacity of the private sector, which can be enhanced only if supportive infrastructure and better public service delivery can be financed. 3.23 The Government has projected a rise in the budget deficit to 1 percent of GDP (after grants) in the next three years (MTEF) to address this concern. This target is within a prudent range. The PER report for FY99 estimates sustainable fiscal deficit levels (after grants), given the growth projections of 5 percent per annum and sustainable level of indebtedness of the country, at 2 percent of GDP. If the current level of the external grants to GDP is maintained at four percent (made more likely by the prospective HIPC resources), then a fiscal deficit of 2 percent as a proportion of GDP would not seem imprudent. Key to sustained price stability is that deficits are not financed through excessive increase in net domestic assets. 3.6 CONCERN ON ABSORPTIVE CAPACITY CONSTRAINT WITH INCREASING RESOURCES 3.24 Another issue relates to the concern regarding possible limited absorptive capacity of the Government for much larger expenditures. Available projections for FYO1 - FY03 show a considerable rise in the share of government expenditure to GDP from the current 15.1 percent to 16.2 percent in FY03, against the backdrop of projected economic growth to the tune of 6.5 percent by the end of this period. This is not a small increase indeed and will be financed through higher domestic revenue and the expected rise in external grants -mainly from enhanced HIPC debt relief A large part of this expenditure increase is on account of the much higher projected external grants and an allowance for a fiscal deficit after grants averaging 0.8 percent over the FY01 - FY03 period in contrast to the estimated surplus of 0.3 percent in FY99. This increase is equivalent to 1.1 percentage points of a much larger GDP base. Currently the priority sector financing needs, based on the MTEF and related supportive technical studies, are grossly under-funded and absorption should not be a problem. Total available finance meets approximately only 60 percent of requirements. This is particularly so given that the workforce in the civil service has been starved of supplies for delivery of service. It can be contended that even with improved cost-efficiency in public service delivery the current ratio of other charges to personal emoluments remains far below the desirable level. Comparable efficiency 46 ratios in Tanzania during the 1960s, when public service delivery was efficient, other charge as a percentage of discretionary recurrent expenditure (netting out debt service) averaged 65 percent. However, the main concern with the absorptive capacity is whether the expected increase in external financing will yield the anticipated results, with a degree of accountability and transparency needed to provide comfort to new forms of financing - budget support and sector-wide programs. 3.7 EARMARKING OF REVENUE AND THE EFFECTIVENESS OF BUDGET MANAGEMENT 3.25 Revenue earmarking for specific expenditures is on an upward trend in Tanzania. The most significant among the earmarking arrangements is the Road Fund. Other forms of earmarking include retention of user charges for specific public services such as education, health, land services and natural resources. These add to the more traditional forms of retention of revenue collected by local authorities/governments. This form of budget management found justification in the effort to protect these expenditures from system-wide resource allocation pressures and in compliance to the multiple level jurisdiction over taxation powers. 3.26 There are three main reasons for starting to pay greater attention to this system of budget management before it mushrooms in an unwieldy fashion. First and foremost is to avoid undermining strategic budget allocations across sectors and geographical locations. Tanzania has just embarked on strengthening the strategic expenditure allocation system through adoption of an MTEF , the rising earmarking trend only serves to undermine this effort and making greater transparency of the budget more difficult to achieve. 3.27 Secondly it is more difficult to enforce overall cross sector and within sector allocations with the greater autonomy associated with revenue retention systems. It is not far fetched to think of the use of such retained revenue in a manner that is not consistent with national prioritization scheme. 3.28 Thirdly and perhaps the most worrisome potential effect in the continued expansion in earmarking, is the likelihood of imposing excessive burdens on specific users of public services, as the relevant sectors strive to raise the resource envelope within their control. Many of the services so provided have useful positive externalities, whose financing burden should be more widely shared. The temptation for keeping on raising the road toll, for example, in order to raise the size of Road Fund are immense and would have dire consequences of excessive cost to the operators. The alternative could be to channel additional resources to the Road Fund from increased allocations from the PMG account and integrating donor finance into the Fund. 3.8 PREDICTABILITY OF DONOR RESOURCES 3.29 Tanzania is one of the major recipients of external assistance as compared to a number of other countries in Sub-Saharan Africa. On average Tanzania receives about US$ 900 million per year from external sources. Most of the external resources have been used for technical assistance, capital budget, balance of payments support and on food aid. This amount is slightly over 10 percent of GDP. However, not all of the inflows pass 47 through the exchequer system to support the Government budget. It is estimated that about 70 percent of such external resources go directly to the projects supported by donors. Every donor has his own strategy of channeling the resources to the targeted projects (A detailed review of donor attitudes towards program and project aid is given in Annex 1). The multiplicity of these resources has made donor coordination a tedious one requiring more capacity at the Ministry of Finance. Donors have different accounting systems, different disbursement modalities and different financial years. 3.30 To harmonize the multiplicity of the donor accounting systems, there are plans to integrate donor facilities in the new Integrated Financial Management System (IFMS) using the Platinum software. In addition, the Government is now in preparing the Tanzania Assistance Strategy (TAS). This is a broad based framework which aims to encompass all the donor interventions in the country in a coordinated manner. In such an endeavor, the Government will list its priorities, take stock of its domestic resource envelope to determine the resource gap which forms the basis for negotiation with donors for support. 3.31 The cut in government expenditure, especially development expenditure, has at times been necessitated not only by unpredictability of counterpart funds, but also by unpredictability of donor finances, particularly those that went directly to the projects without passing through the budget or being recorded by the Government. The extent of integration of donor resources into the budget, for example, was 19 percent in FY95, 12 percent in FY96, 28 percent in FY97 and 33 percent in FY98 (PER FY99 Issues Paper). Moreover, actual releases of resources as compared to those budgeted have shown a large variance for the development budget. Between FY95 and FY98, for example, the shortfall of donor disbursements ranged between 42 percent and 79 percent of budget projections, while local counterpart funding shortfalls ranged between 16 percent and 76 percent. The problem of unpredictability of the budget, either due to shortfalls in local counterpart funds, non-adherence to conditions for donor disbursement, inaccurate projections, or unrecorded donor support, is among issues that are at the core of the debate on how to strengthen the government-donor partnership in development and have been treated at greater length in the earlier sections. 48  4. FISCAL POLICY AND THE MACROECONOMIC CONTEXT 4.1 INTRODUCTION 4.1 Over the last several years the Government of Tanzania has run a tight fiscal policy through the instrument of a cash budget with a domestic budget surplus. The consequence has been a fairly rapid but orderly process of disinflation, with the rate of inflation coming down to an annualized rate of around 7% by the end of 1999. While it is essential to consolidate this achievement so that there is no return to the double-digit inflation of earlier years, it is nonetheless no more than a precursor to the real agenda of growth and poverty reduction. Growth is important not only in its own right but as a mechanism for reducing poverty both directly and indirectly via the enhanced social spending it permits. The sources of this growth will inevitably lie in private enterprise, with the government attempting to minimize factors that may inhibit this and promote those that encourage it. The latter factors include not only the regulatory and market environment, but also macroeconomic policies bearing on investment, saving, liquidity and credit. 4.2 There are two types of circumstance in which designing macroeconomic policy is relatively straightforward in principle, however hard to execute in practice. One is when the economy is suffering from excessive fiscal deficits, rapid monetary growth, high inflation, and a lack of private credit. The imperative then is to reduce the deficit, which permits the other problems to be addressed. The second circumstance is when there has been an extended history of steady growth in a stable policy environment, in which case the imperative is to maintain the policy regime. Tanzania is currently in neither of these configurations, but in transition between the two. While this is a satisfactory interim outcome, given the country's earlier policy history, it does make the current design of policy more difficult. 4.3 The crucial short run choice is over the volume of resources the government can devote to its spending programs without crowding out the recovery of private activity. There is also the closely related question, which is how many resources can the private sector use? Addressing either question requires us to form a view of how private and public activities are related. The next section of this paper briefly reviews the major mechanisms involved, from a perspective reflecting current conditions in Tanzania. Section 3 reviews the resources available to government, and Section 4 considers how this information is deployed in the Guidelines for the Preparation of the MTEF. Section 5 reviews the domestic credit position, Section 6 discusses options for the government's fiscal stance and Section 7 concludes. 4.4 To keep the discussion in the text reasonably brief, a substantial amount of material is relegated to three annexes. Annex 1 provides background on developments in the real economy, including some discussion of our incomplete information. Annex 2 contains a conceptual discussion of fiscal policy issues, and particularly of the 49 importance of separating the domestic from the external components of the fiscal deficit. Annex 3 provides a discussion of debt sustainability. 4.5 It should be stressed at the outset that the Tanzanian authorities have done a great deal of effective work to produce a coherent and consistent budget frame, which incorporates the best available information on revenue projections as well as a large volume of sectoral work on priorities. This process has undergone an impressive cumulative development over the last couple of years, but remains an ongoing one. Against this background, these notes are intended to highlight some issues for consideration and possible further development of this process. 4.2 LiNKs BETWEEN PUBLIC AND PRIVATE ACTIVITIES 4.6 These are many, varied, and mainly familiar, including most notably taxation and other forms of de facto confiscation5, and the whole panoply of regulation and law, but here we focus on three other mechanisms. These are the competition for credit, the real exchange rate, and supply side effects. 4.7 It may seem obvious that there is direct competition for domestic credit, so that increased use of it by government will crowd out private sector access one-for-one. We are also often in the habit of thinking that the private use of credit is intimately related to investment. Hence the concern that government borrowing may crowd out private investment and ultimately growth. There are qualifications to this view however. Most important, there is nothing to ensure that the banking system will remain fully lent if the government reduces its borrowing. If private borrowers are deemed not to be creditworthy, the system simply becomes more liquid and the loan-deposit ratio falls. This has evidently happened in Tanzania, though it is difficult to be precise about the degree, since the fall in loans also reflected the cleaning out of non-performing parastatal loans. Second, much of the credit advanced to the private sector in Tanzania is for trade rather than for investment. Investment tends to be financed from an enterprise's own resources or, in cases where the outputs will generate foreign exchange (such as mining) from external sources. Thus, especially in the short run, withdrawal of government may neither induce increased access to credit by the private sector, and even if it does, this may have a very muted impact on investment activity. Finally, a rapid expansion of private sector credit might in any case be problematic. Since the banking system lacks experience in risk assessment, the alternative to rather limited lending might be a rush of lending leading to an unacceptably high bad-debt ratio. 4.8 When a government obtains access to increased resources from external donors and spends some part of this on non-tradable goods, this will tend to induce appreciation of the real exchange rate (so-called 'Dutch Disease'), unless there are offsetting effects on supply. Provided the aid flow is likely to continue over a relatively long horizon, this is just a necessary cost of accessing the additional resources. It might be of particular concern when it is hoped to develop some types of non-traditional exports and this might have some bearing on how the aid is used; however, it seems most unlikely that it would While taxes are the most important single mechanism for "crowding out" private activity - by removing private purchasing power - their share in GDP is difficult to raise quickly. Hence, the burden they impose is a relatively fixed feature in the short run. 50 ever be a ground for rejecting incremental aid flows. To do so would be analogous to refusing to exploit a newly discovered mineral resource on the ground that the consequential exports would damage the interests of other exporters. Supposing that it is agreed that it is appropriate, nationally, to utilize the additional resources, then some agents in the economy must raise their expenditures. The key point is that these Dutch Disease effects are in no way specific to government involvement. Exactly the same issue arises for transfers of external resources to NGOs operating in-country, or to increased private spending if the government passed the aid on to the private sector via tax cuts or increased credit. What matters is that the nation is able to spend more and that part of this spending is on non-tradable. In brief, the real exchange rate issue is a feature of accepting the resource inflow, not of any link between this and the level of government spending. 4.9 The argument in the preceding paragraph must be qualified to the extent that some forms of spending are likely to have supply side effects. Especially if these come into operation quickly, the real exchange rate consequences of the inflow will be muted and may even be reversed. For example, a program of rehabilitation of roads could remove bottlenecks and lead to an expansion, inter alia, of the production of non-tradable in excess of the increased demand for them. This argument leads on to the more general point that private and public activities are frequently complementary, so that the private sector may not be best served by a contraction in public sector spending. This is particularly likely to be true in Tanzania, where many forms of government spending are low by the standards of comparable countries. 4.3 RESOURCES LIKELY TO BE AVAILABLE TO THE GOVERNmENT, FYO1 - FY03 Domestic revenue 4.10 It is convenient to scale the main fiscal magnitudes relative to GDP. The series for domestic revenue as a share of GDP given in the Guidelines6 of February differ somewhat from those in the Poverty Reduction and Growth Facility document of March. Since the revenue figures are largely the same, there must be some difference in the treatment of GDP. However, both show revenue growing modestly as a share of GDP over the years FY00 (provisional out-turn) and the three years projected for the MTEF. 4.11 Here we work with the figures in the Guidelines, which are 12.4% for the current year, and 12.6%, 12.8% and 13.0% for the MTEF period '. The present figure is modest by the standards of comparable countries, and the assumed growth of revenues, at 0.2 percent of GDP a year, also does not seem excessively ambitious. However, it has to be noted that this ratio has averaged 12.4% over the last decade, and while it has varied substantially year on year, it has been trend-less. The authorities are not planning any 6 Guidelines for the Preparation of the Medium Term Expenditure Plan and Framework 2000/01 - 2002/03, MOF and Planning Commission, February 2000. PRGF has 11.5%, 11.6%, 12.0% and 12.2%. 51 major tax reforms, but are relying mainly on reduced exemptions and increased administrative efficiency to deliver the revenue gains8. 4.12 On past performance, this may prove difficult to deliver. It may depend to a marked extent on the form which growth takes. Some sectors (mining, manufacturing) are easier to tax than others (subsistence agriculture). The Guidelines anticipates growth over MTEF period at annual rates of 6.1%, 6.6% and 6.8%, with mining growing at three times the average, manufacturing at twice the average and agriculture at a little over half the average. This type of compositional shift should make it easier to raise the tax share without raising tax rates, which are already quite high. The baseline assumptions in the Decision Point document for the enhanced HIPC Initiative (March) assume somewhat lower growth, but, more importantly, they assume that agriculture and manufacturing both grow at close to the average rate (mining is again assumed to grow substantially faster). This configuration of growth would make raising the revenue performance rather harder. In any event, it would be worth developing a more disaggregated method of forecasting revenues, both to obtain more refined inputs into the MTEF and also to permit closer monitoring of performance. Aid 4.13 Whereas the Guidelines envisage some uplift in domestic revenue as a share of GDP, the converse is true for aid flows. Abstracting from the interim relief under HIPC (0.2% this year and then 0.6%, 0.6% and 0.5%), these are shown as declining sharply (6.2% in the current year, and then 3.1%, 2.9% and 2.0%). However this contraction of resources simply reflects the lack of forward commitment by many donors and is heavily concentrated on project finance in the development budget. If we strip out the foreign financed part of the development budget, we are left with a flow of import support at 2.8% in the current year, and then 3.1%, 2.9% and 2.0%. There are also some rather small changes in domestic financing (from a small domestic surplus to a balanced domestic budget). The net effect for recurrent expenditure plus the locally financed component of the development budget is to follow the likely out-turn at 13.5% of GDP this year with figures of 13.9%, 13.9% and 14.0% over the MTEF horizon. In effect, the modest growth of domestic revenues plus HIPC plus the somewhat more relaxed domestic fiscal stance is fully neutralized (after the first year) by the anticipated erosion of program aid. 4.14 However, this erosion is most unlikely to happen. There is a strong case for basing the MTEF projections on the most likely scenario, which is that program aid will in fact continue at similar relative levels to the present ones. To take a more conservative view would only be justified either if there were strong grounds for believing that aid cuts were probable, or there were grounds for thinking that regular upward revision of spending ceilings is allocatively less costly than infrequent downward revisions. By way of contrast, the HIPC Decision Point document assumes very substantial inflows of new resources in this period, so that the NPV of debt to exports actually rises quite rapidly in the first few years after HIPC relief. ' The 'built in elasticity' of many taxes is somewhat less than one, so that revenue tends to rise proportionately less than the relevant tax base. This means that the tax authorities sometimes have to 'run to stay still' in terms of revenue shares. 52 4.15 Handling this forecasting issue is difficult, and made more so by the fact that there are many relatively predetermined calls on government resources (debt service, wages). This has the consequence of levering relatively small proportional adjustments in total resources into much larger proportional changes in discretionary spending. For example, if the level of program assistance in the last year of the MTEF remained at the level around 3% of GDP as in earlier years, and these resources were used on the discretionary category of goods and services, spending on the category could be raised by nearly 15%. In any event, forecasting resources is necessarily risky, but the risk is two- sided, and not minimized by excessive caution. 4.4 THE GUIDELINES DOCUMENT 4.16 The Guidelines document has a rather complex set of functions. It is at the heart of the two-way process between the spending ministries and the central economic authorities of the government. However, given the commitment to transparency and participation, it also offers a window on that process for other participants and affected parties. One function that is common to both these roles is that of demonstrating the relation between the derivation of priorities and the budgetary outcomes. In many respects, the Guidelines is an admirable document, and very clearly constructed; however, there is room for improvement, particularly in this last regard. 4.17 Tables are provided relating the "funds requirements and proposed allocations" for the various priority sectors. The logic leading to the selection of the priority sectors themselves seems clear enough. However, it remains obscure what governs the distinction between priority and non-priority activities within these sectors. It is also obscure how prioritization affects the budget allocation process. This may be a matter of substance, that is if the concept of prioritization is poorly articulated with the process of budget allocation. Alternatively, this link may be well established, in which case what is required is merely a clearer exposition of it in the document. To illustrate the point, consider the information abstracted from the Guidelines in Table 1 for a number of priority sectors. 4.18 The startling thing about this table is the lack of any pattern. Sometimes allocations are very far below requirements, sometimes they exceed them. In some cases the ratio for a sector is stable over time, suggesting that the severity of rationing is constant: in others it falls or rises. It does not seem as if the term "requirement" has any stable interpretation, either between sectors, or within a sector over time. This means that the role of the MTEF in matching limited funds to those activities which have the highest pay-offs or are otherwise felt to be most urgent is very inscrutable to the outside observer. Hidden within the table, there is however one pattern, which is that a particular ratio for a sector in a given year is usually applied across all activities in the sector. 53 Table 4.1: Budget allocation as share of requirement for priority activities in various sectors (%)__ _ _ FY00 FYO1 FY02 FY03 Education 63 90 111 142 Health* 53 66/85 94/109 127/141 Water 35 47 34 50 Agriculture 32 38 36 38 Roads (National/Regional) 109 83 85 85 (District/Urban) 87 82 82 80 Energy 19 25 28 30 Judiciary 40 45 45 46 * Health includes activities which were not listed in the requirements but which received priority allocations. The lower figure gives the ratio ignoring these expenditures, the higher includes them. 4.19 For example, the ratio of 63% applied to education in FY00 was applied uniformly across primary, secondary and higher education as well as the inspectorate. If the "requirements" entry for each of these sub-sectors reflected careful consideration within the sector - so that a uniform benefit/cost cut-off had been applied, then uniform rationing would be appropriate. However, the rather random behavior of a sector's ratios over time makes that seem implausible. 4.20 In any event, there seems to be considerable scope to develop this linkage between the prioritization process and the budget allocation more systematically. 4.5 ASPECTS OF DOMESTIC CREDIT 4.21 It has been remarked that, for a number of years, the ratio of various money measures to GDP has been falling in Tanzania. This is a potential cause for concern for two reasons. The first is that it robs government of opportunities to obtain seignorage revenues in a non-inflationary way. The other, of wider significance, is that we normally anticipate economic development to be accompanied and indeed facilitated by a process of financial deepening and this involves a rising money to GDP ratio. A falling ratio is then a signal of financial ill health. It may reflect a lack of confidence in the domestic currency, so that agents economize in holding it, possibly by substituting international currency. Alternatively, it may be a response to financial repression, where very unfavorable terms make the formal financial sector an unattractive intermediary. In either case, high transactions costs are imposed on economic activity. When these conditions are reversed by successful policies of stabilization and liberalization, we would expect the demand for money to recover, but possibly quite slowly and after a lag as confidence is re-established. 4.22 Both of these phenomena were present in Tanzania, and both have been reversed by policy reform. The financial system is therefore likely to be in a transitional phase, which may be further complicated by the process of privatization. Table 4.2 presents a number of summary statistics for the last five years, again using GDP as a scaling device9. The liberalization had also led to dramatic shifts in the composition of broad money (currency, and the various types of deposits - demand, savings, time and foreign End of year value as per cent of GDP for the preceding year. 54 currency), but by 1995 these seemed to have settled down. Hence the table starts from that year and does not explore this compositional issue. 4.23 There are several disturbing features of the data in this table. First, there is the continued decline in the money income ratio well into the post liberalization period. Over the three years 1995 to 1998, this ratio was falling at an average annual rate of 11 per cent. There are signs that this is now stabilizing however. The behavior of reserve money is included as a memorandum item. It followed a very similar path, pretty stable at 41% of M3. This reflects the loss of seignorage referred to earlier. Also, since the bulk of MO is currency outside the banking system, this has also fallen sharply relative to GDP. Table 4.2: Financial variables in % of GDP 1995 1996 1997 1998 199910 Monetary Survey Broad Money (M3) 24.9 21.7 19.7 18.2 19.0 Net Foreign Assets 5.5 7.7 8.5 8.3 9.7 Net Domestic Assets 19.4 14.0 11.2 9.9 9.4 Credit to Government 9.2 7.9 5.1 4.8 5.6 Credit to Private Sector 5.4 3.1 3.5 4.3 4.7 Other 4.8 3.0 2.7 0.9 -1.0 Memo item (MO) 10.4 8.9 7.8 7.4 8.0 Commercial Banks" Domestic Deposits 17.7 15.4 14.2 13.2 13.0 Of which, by private 13.8 13.0 12.3 11.2 11.3 Total Domestic Lending 9.0 3.9 3.9 4.5 4.9 Of which, to private 5.4 3.1 3.5 4.3 4.8 Government Securities 5.6 6.8 5.2 5.5 5.1 Cash and Deposits with BOT 2.2 1.9 1.3 2.0 1.6 Foreign Assets 5.6 4.8 5.0 4.7 4.8 Lending to deposit ratio (%)u 50.5 25.3 27.7 33.7 37.9 4.24 On the asset side of the monetary survey, the steep decline that is the necessary counterpart to the fall in the money income ratio is not uniformly distributed. The net foreign asset ratio in fact showed steady growth at an average rate of 15%. This reflected in part the drive to raise the net international reserve position. In consequence, the fall in the domestic asset ratio is really precipitate: it has more than halved over the period, with most of this happening in the first two years. This was the consequence of sharp reductions in credit to government and the 'other' component that includes parastatals. The private credit ratio followed a U-shaped path. To For Monetary Survey, end December 1999, for Commercial Banks, end September 1999. The table does not provide an exhaustive breakdown of all liabilities and assets, so the listed components of the balance sheet do not sum to zero. 1 These are for domestic deposits and loans only so differ slightly from those calculated by BOT. 55 4.25 Further light is thrown on this evolution by the figures for the commercial banks. The domestic deposit ratio fell quite sharply, but this was largely due to a contraction in the official component, with the private deposit ratio holding up quite well. Total domestic lending fell sharply in the first year, but the loans to the private sector, unsurprisingly, were almost identical to the private credit component of the monetary survey. It is worth noting that the commercial banks hold foreign assets of the same order as their total lending to the private sector and usually somewhat larger. The loan to deposit ratio fell from a value of a little over 50% in 1995 (probably not unreasonable for what is essentially a deposit banking system) to a very low level of about half that in 1996 and 1997 before making a partial recovery in 1998 and 1999. 4.26 While it seems most illuminating to present these data in the form of ratios to GDP, it is worth stressing that private credit has indeed expanded rapidly albeit from a very low base. Over the four years from the end of 1996 it has risen in nominal terms at annual rates of 39%, 48% and 26%, or from Tsh 116.6 billion to Tsh 302.2 billion. Since the cumulative inflation over this period was 37%, the growth in real private credit averaged 24% per annum over these three years. 4.27 To summarize all this information, what seems to have happened is that the government has made a major withdrawal from its previous reliance on domestic credit, but this has had a rather limited effect of "crowding the private sector back in". On the contrary, private sector engagement with the financial system, relative to GDP, seems to have been relatively invariant to these changes. Hence the reduction in government engagement has simply led to a contraction in the scale of financial intermediation. The banking system is currently under-lent and over-liquid. There are a number of reasons why this may be the case. As inflation has fallen, there has been little downward shift in either loan or deposit rates. This has had the effect of turning real deposit rates from heavily negative to - just - positive, but only in the last six months. It may eventually lead to increased private domestic deposits. However, the other effect has been to raise real loan rates from moderate to high levels, which may have replaced quantitative credit rationing with rationing by price. In addition spreads have remained wide and the banking system is inexperienced in risk assessment for loans to the productive sectors. All these difficulties seem to be common across countries following financial liberalization. It is not clear why, but an extended transition period seems to be necessary. Presumably both the deposit ratio and the loan to deposit ratio will pick up in the future: the difficulty is in gauging when this might happen. 4.28 The upshot of this quick overview of money and credit is highly ambiguous. A major reduction in the government's use of domestic credit has produced a rapid proportional expansion in private credit, but since the base for this expansion was so small, this private response has still been small relative to the scale of the stimulus. In addition, the earlier financial liberalization and disinflation have still to feed through into the terms and conditions on which credit is available. The system seems to be very far from equilibrium, but it is hard to judge the rate at which it will move. We consider the implications further in the following section. 56 4.6 FISCAL OPTIONS 4.29 It is argued in Annex 2 that fiscal options can conveniently be thought of by partitioning the overall deficit into the component that can be financed externally (on concessional terms) and the component that requires domestic financing. Further, Annex 3 argues that it is desirable for Tanzania to accept as large an external deficit as donors are prepared to finance. For any given choice of domestic deficit, this implies that additional aid should automatically be spent. In turn, the considerations determining what an appropriate level of the domestic deficit might be are not contingent on the level of external finance that is available. 4.30 In examining these considerations, we assume that the government can use additional resources effectively, i.e. that it has not reached its implementation limits. Then the choice of a value for the deficit depends on what levels of monetary expansion, build-up of foreign exchange reserves, and expansion of credit to the private sector are desired. 4.31 The strategy in the Guidelines is currently designed to switch fiscal policy from the fairly substantial domestic surplus that has been run in recent years, on the order of 1% of GDP, to a much lower level in the current year and in the first year of the MTEF, and to (domestic) budget balance thereafter. However, this switch is less complete than might appear. There is a general contingency built in, which behaves rather oddly: it moves from 0.4% of GDP in FY01 up to 0.9% in FY02 before falling back to 0.3% in FY03. Apart from being inexplicably volatile, these numbers are large. In this configuration they also represent an unsatisfactory device. There are really three possibilities. First, they could remain unspent, in which case the government will really be running a domestic budget surplus, not a balance. Second, they could be deployed in face of some genuine unforeseen events, but it is wildly implausible that these would have expenditure implications of this pattern. Third, they could end up being spent but according to the exercise of ministerial muscle rather than the allocational procedures embedded in the MTEF. If the intention is to smooth spending in the expectation of uneven revenue flows, that should be signaled, rather than calling the device a contingency. Since the revenue fall in the final year is most likely an artifact of the forecasting procedure, as already noted, the "contingency" is in fact likely to remain high in the third year of the MTEF. This would exacerbate the problem of either effectively running a substantial surplus, or having resources whose deployment might not be subject to the full rigor of prioritization within the MTEF. 4.32 Foreign exchange reserves are already at the target value of four months imports. While there is some evidence that the decline in the demand for money relative to GDP has been halted and may even have reversed, it would not be wise - yet - to rely on a falling velocity of circulation. Hence the prudent rate of monetary expansion would involve a stable velocity, so that the authorities can plan for the money supply to rise in line with nominal GDP at the target rates for inflation and real growth. This would place the expansion at around 11% per annum over the MTEF period. Since additions to foreign exchange reserves will only be required to match the growth of imports (to preserve the 4 month ratio), a balanced budget implies that the bulk of this permissible monetary expansion should be available for private credit. This in turn could imply a 57 continued very rapid expansion of private credit, but now from the somewhat enhanced base generated by the previous expansion. The scale of this potential expansion is likely to cause problems for the commercial banks in identifying creditworthy customers. If they are inclined to lend regardless, that poses problems for the authorities in supervising the banks. On the other hand, the commercial banks may react by failing to expand their loan portfolio at the implied rate. 4.33 In these circumstances, there is quite a compelling case that the government should choose to run a modest domestic deficit rather than a balanced budget; this would enable it to increase spending on the under-funded recurrent budget and improve service delivery. It is not clear, given the credit position just described, that it would risk crowding out desirable private activity. This is not to deny that there needs to be adequate provision for further expansion in private credit. Indeed the capacity to do this is already built into the present, highly liquid, system. The question is rather how much credit the private sector is plausibly going to require, and whether it is likely that it will be able to use the whole increase in domestic credit over the next several years. 4.7 CONCLUSION 4.34 There has been much progress over the past year, both in consolidating the achievements of macroeconomic policy and in developing the budget process. In particular, the move from a domestic budget surplus towards balance is timely, though it is for consideration whether the shift could be carried a little further still. However, the transitional status of the Tanzanian economy makes macroeconomic management particularly difficult at present, and it will be important for the authorities to remain flexible. Within the MTEF itself, there is also scope for rethinking the use of the contingency item, and for improving the transparency of the link between prioritization and the budget allocation process. 58 PART III SECTORAL PUBLIC EXPENDITURE ISSUES 59  5. EDUCATION SECTOR 5.1 BASIC EDUCATION 5.1.1. Scope of the PER FY00 5.1 The FY00 Public Expenditure Reviews (PER) for the basic education sub-sector and other priority sectors were commissioned by the Government of Tanzania's PER Working Group during the first half of FY00 to form the basis for the Government of Tanzania's FY01 budget and FY01 - FY03 medium term expenditure framework (MTEF). 5.2 The education sector PER is explicitly an update of the FY99 review. It is based on the broad framework of the FY99 PER and updates the findings based on the latest available statistics. The PER FY00 differs from the FY99 review by providing a systematic assessment of the activities which the education ministries will need to undertake to generate a high quality input to the medium-term expenditure framework for FY01. 5.1.2 Recent Developments 5.3 Three main developments in the form of sector initiatives have taken place since the FY99 PER was produced. The initiatives are: the local government reform program (LGRP), the school mapping, and the Education Sector Development Program (ESDP). The LGRP will lead to major challenges for education sector planners as it shifts responsibility for resource allocation from central to local authorities. Starting around mid-2000, districts will be allocated an education block grant which they can use at their discretion to strengthen education services. In the past, these funds were tied to teachers' salaries. Now the decision on the proportion of funds which should be used to fund salaries will be made by the districts themselves. Districts will be held accountable by the government against a set of agreed service standards. This change is intended to enhance efficiency and effectiveness in the provision of education services. 5.4 School mapping describes the process of information gathering and community consultation during which information on a wide range of education issues is collected through district wards. Fifteen districts have already been mapped, with the balance expected to be complete by end-2001. The ESDP is a means through which Tanzania can address some of the profound inefficiencies which beset the sector. Though still to be finalized, the ESDP provides an impetus to develop a coherent sector strategy, and to help government cut back the high management costs which it experiences through uncoordinated donor projects in the sector. 5.5 These three developments will have far-reaching implications for the sector. The LGRP provides a basis for the redistribution of teachers, since districts will be held 60 accountable for service standards and will have incentives to redeploy teachers from surplus to deficit areas. It should also lead to an improved balance of spending between salaries and other charges. The school mapping process will support these changes. Data produced by the district exercises can be used to validate and update existing planning information, and the micro-plans generated under the process will galvanize local community support for education. The ESDP should see a significant increase in the development funds available to the sector. 5.6 Although each of these initiatives will have an impact on planning at the central level, the contribution of the LGRP and ESDP is difficult to estimate. Planning for both programs is still underway, so it is important that planners within MoEC keep themselves informed of progress in the development of these activities. 5.1.3 Expenditure Trends 5.7 Recurrent Expenditure: Total government recurrent expenditure on education has increased in real terms over the last 10 years. Expenditure has increased in real terms and on a per capita basis. An average of 24 percent of total government recurrent expenditure is spent on education, although compared to other countries the absolute amount spent is still low. The largest share of government recurrent expenditure goes to primary education. In 1998, 62 percent of total recurrent funding to the sector was spent on primary education, compared to 51 percent in 1992. Real government recurrent expenditure per primary pupil has increased by around 40 percent since 1992. At public secondary schools, real recurrent expenditure per pupil has fallen by around 50 per cent since 1992. At teacher education colleges, real recurrent expenditure per pupil has more than doubled since 1995. Table 5.1: Share of Actual Recurrent Budget Expenditure, 1992/93 - FY99 92/93 93/94 94/95 95/96 96/97 97/98 98/99 Primary 0.51 0.52 0.63 0.65 0.67 0.67 0.62 Secondary 0.15 0.14 0.10 0.07 0.07 0.09 0.07 Teacher Education 0.05 0.04 0.03 0.02 0.02 0.03 0.02 Higher & Technical 0.20 0.23 0.20 0.21 0.20 0.17 0.24 Administration and other 0.09 0.07 0.05 0.05 0.04 0.05 0.05 Total nominal 1.00 1.00 1.00 1.00 1.00 1.00 1.00 5.8 Development Expenditure: Development expenditure is sourced mainly from foreign donors. A small amount, 8 percent, of the total government development budget (including foreign funding) goes to education, mostly to primaryl". Parents are the main financiers of primary education, spending more per pupil than government. At secondary level they fund at par with government. In absolute terms parents pay more for secondary education than they do for primary, since the cost of secondary education is much higher than that of primary education. 5.9 Expenditure Management Issues: Development expenditure is disbursed intermittently from central government to the districts. The rationale for allocation is not clear at either central or district level. A significant portion of public and private These figures may be underestimated due to incomplete coverage. 61 allocations to the sector are not spent on education. Districts retain a significant portion (57 per cent) of the universal primary education fee rather than allowing it to be retained at school level as per government policy. In addition, some 41 per cent of government recurrent allocations for other charges (e.g. text books, etc) may be spent outside the sector4. District councils tend to generate and remit resources to education. 5.1.4 Performance Trends 5.10 Despite this rise in resource availability, the performance of the sector has continued to disappoint: In primary education, all major indicators (see Table 5.2) show a deterioration against the annual average results for the previous five years. Nor does the trend of this deterioration appear to be declining. Table 5.2: Performance Indicators in Primary Education 5-year average (1993- Performance in Government target 1997) 1998 (by 2003) Total Government spending (TSh bn) 74.49 74.84 Total enrollment 3.943.579 4,042,568 t.b.c Pupil-teacher ratio/2 37 39 45 Gross enrolment ratio 78% 77% 85% Net enrolment ratio 56.2% 56.5% 70% Completion rate Sl-SIV 87.3% 86.8% 95% Completion rate SI-SVII 68.0% 66.5% 95% Non-salary cost per pupil (TSh) 518 744 10,000 Total cost per pupil (TSh) 18,452 18,253 21,000 SVIl-Form I Transition rate 15.2% 15.0% 20.0% Drop out rate 6.6% 6.6% 3% Primary School Exam Passes - boys 26.32% (1) 25.9% 60% - girls 14.01(l) 13.0% 60% -total 20.17%(1) 19.4% 60% Notes: 1. Figures for 1997 only. 2. There is some debate within MoEC about the accuracy of PTR data. 3, MoEC reporting of total enrolment ratios appears inconsistent with same data by gender. * In secondary education, which has in fact suffered a fall in resource availability as funds are redirected towards primary education, performance indicators have improved. Concern still exists, however, about the low level of exam passes in the secondary sub-sector. Seminaries (private and accounting for seven per cent of all secondary schools) achieve pass rates at least double that of the rest of the sub-sector (public and private), so there is substantial scope for performance improvement. 14 PWC Op cit 62 Table 5.3: Performance Indicators in Secondary Education 5-year average Performance Government (1993-1997) in 1998 target (by 2003) Total government spending (TSh bn) 8.67 8.49 t.b.c. Total Enrolment 206,845 226,903 t.b.c. Pupil-teacher ratio 18.06 19.41 t.b.c. Survival rate Fl-FVl 14.4% 27.0% (1) t.b.c. Non-salary cost per pupil (TSh) 12,091 11,480 t.b.c. Total cost per pupil (TSh) 39,813 33,098 t.b.c. Form Four Exam (pass at 1-Ill) 23.65% 29.00% t.b.c. Form Six Exam (pass at 1-111) 71.42% 75.80% t.b.c. Notes: 1. FY98 In teacher training, efficiency continues to fall as the number of trainers has not fallen in line with declines in the number of students. As a result, the trainee/teacher ratio in teacher training colleges has halved in the past five years. Also, there is evidence that a large number of teacher training graduates do not actually become teachers, so the state's investment in their training is, to some extent, wasted. Table 5.4: Performance Indicators in the Teacher Training Sub-Sector 5-year Performance Government average in 1998 target (by (1993-1997) 2003) No. of students 14,179 6,614 t.b.c First year students 5,891 1,838 t.b.c Percentage of first years 41% 28% t.b.c Students per college 394 189 t.b.c First year students per college 163 53 t.b.c Final year students as a percentage of all students 47% 28% t.b.c Successful graduates per college 203 87 t.b.c Students per staff member 14 7 t.b.c Staff 1,060 940 t.b.c Number of colleges 36 35 t.b.c 5.11 With funding having increased and performance still declining, it seems clear that additional resources will not generate an improvement in performance in the sector unless the sector can strengthen its internal efficiency to generate improvements in performance. 5.1.5 Regional Variation 5.12 There is substantial variation in performance between different regions. Table 5.5 shows the average, highest and lowest regional values for two key indicators of performance. As shown, Kagera has only 43 percent of its school-age boys in primary school, whilst Kilimanjaro has managed to enroll 71 percent. Dar es Salaam has managed an impressive 81 per cent net enrolment rate for its girls, while Kagera manages just 46 percent. 63 Table 5.5: Regional Variation on Selected Performance Indicators boys girls Total Net Regional Enrolment Rates: Highest value 71 81 76 National average 56 58 57 Lowest value 43 46 45 PSLE passes at regional level: Highest value 44.67% 27.47% 34.66% National average 25.94% 13.02% 19.43% Lowest value 15.26% 5.94% 10.32% 5.13 As was emphasized in the FY99 PER, such levels of regional variation suggest that there is considerable scope for improvements in efficiency and effectiveness, and that there may be inequitable allocation of resources. Furthermore, they suggest that there may be opportunities for regional targeting of investment and effort to raise some of the key performance indicators. The situation in Kagera, for example, clearly warrants urgent attention. 5.1.6 Budget and Expenditure Projections 5.14 Projections of the likely costs of sector spending proposals and resource availability were made using the same model used in the FY99 education sector PER. Taking a base case scenario, which uses the Ministry of Finance's own GDP projections, it is clear that there will be insufficient funds available to meet the cost of government's policy objectives and targets for the sector. Even under a more optimistic scenario, which assumes significant efficiency improvements (the main efficiency driver in the system is the PTR) and increased development resources, partly through the HIPC II initiative, a financing gap is likely. 5.15 The results of these projections are, perhaps, surprising given the resources which MoEC has dedicated to sector planning over the past few years. A wide range of reports - most notably the basic education masterplan (BEMP) - has identified the key opportunities in the education sector. In principle, these reports should have provided sufficient information to produce a viable and sustainable medium term financing strategy. 5.16 In practice, however, these studies have not resulted in a coherent and sustainable sector strategy. The reason is that they did not place enough emphasis on practical aspects of planning. In particular, there has been a lack of prioritization of activities, and a lack of insight into appropriate sequencing of activities. 5.1.7 Next Steps 5.17 The Education PER review concludes that there are six priority areas for action which the Basic Education sub-sector must address if it is to provide future generations of Tanzanians with the types of skills needed by the country in the twenty-first century: * Since the current spending proposals (implied by current policy targets) of the Ministry of Education and culture cannot be met from government resources, even under optimistic revenue assumptions, a revised series of spending proposals needs to be developed. 64 * Despite increased funding, the performance of the sector has continued to decline. This demonstrates that the sector needs to place at least as much emphasis on its internal efficiency as it does on seeking additional resources. * Within the various sub-sectors, major opportunities to improve sector performance will come from: * In primary education, the reallocation of teaching posts and double shift teaching in urban areas (note, however, that additional funding is probably needed to facilitate the redeployment of teachers); * In secondary education, addressing the low number of places available in the sub-sector and identifying the reasons for the disparity between results in seminary and public schools; * In teacher training, cutting back facilities and numbers of trainers (perhaps re-deploying some to the primary and secondary sectors), and tying trainees to periods of teaching. * The sector has not provided a comprehensive and coherent statement of priorities within the sub-sector. Without such an explicit indication of priorities, the sector will find it difficult to respond to disruptions in financing. The MOEC must produce such a statement, which should be guided by technical advice on the appropriate sequencing of activities, as a matter of urgency. * The school mapping exercise provides the sector with an opportunity to enhance its planning capacity, including by focussing on district level planning issues. But the amount of information being generated by the studies threatens to overwhelm the statistics unit of the ministry. Urgent attention needs to be given to the question of how such information should be coded and stored, and how collection approaches can be harmonized to ensure comparability of data. * The statistics collected by the ministry allow for a comprehensive assessment of sector performance. But the annual BEST document does not make the most of these opportunities. The document needs to be updated to allow the comparison of key performance indicators, and should include a commentary by the ministry explaining why performance has changed over the 12 months. 65 5.2 HIGHER AND TECHNICAL EDUCATION 5.2.1 Recent Developments and Education Policy Context 5.18 Reforms in the education sector were part and parcel of the economic reforms that started in 1986 a la Bretton Woods Institutions. The reforms began with the adoption of the First Economic Recovery Program (ERPl). Tanzania mainland was the first to undertake these reforms followed by Zanzibar two years later. The main key issues of these reforms for the education sub-sector were access, quality, financing and efficiency. However, various sectoral reviews in the Education Sector Development Program (ESDP) and in the Education Public Expenditure Review (EPER) have not addressed the reform issues at all the levels of the education sector: primary, secondary and tertiary. The lower two sub-sectors continued to receive greater reform and planning attention. The broad Education and Training Policy (ETP) was therefore started in 1995 to harmonize all activities in the education sector so that the benefits of reforms reach all the three levels. The ETP objectives were quality improvement; increasing access to education for women and other disadvantaged groups and areas; broadening the financial base for education and training; enhancing of partnership in the provision of education including decentralization of authority and responsibilities; integration of formal and non- formal education and facilitation of the culture for job creation and self employment. The Higher Education Expenditure Review thus derives its framework from and is consistent with the ETP broad objectives. 5.19 Less attention to the tertiary sub-sector has led to deliberate constriction of demand due to the failure to accommodate the higher supply of quality students for admission; high cost of delivery of tertiary education; input oriented management rather than result oriented; and unguaranteed comparable quality of inputs. Higher Education Development (HED) should, therefore, receive resource priority to address these problems whose solutions are defined as strategies in the medium term policy and regarded as a future thrust of achieving both internal and external efficiency targets. It is noteworthy that the plans for quality higher and technical education, and general investment in skilled human capital continue to be developed in the context of poor quality secondary education. The Higher and Technical Education macro-policies are therefore set to serve and address problems of lower sub-sectors. In this light, the National Council for Technical Education (NACTE) is intended to deal with issues of coordination, curriculum quality control, accreditation and licensing as solutions to the problems. 5.2.2 Sub-Sector Performance 1994-2000 5.20 The sub-sector performance during the 1994-2000 was generally low. * There has been low university enrolments (both public and private) that can be translated into a low participation rate of 0.27 gross enrolment ratio for a national population of about 32 million people. * With respect to Technical Colleges, student enrolments were generally low. Technical education had also imbalances in the ratio of 66 engineers/technologists, technicians and craftsmen. The present ratio is 1:2:14 instead of the target 1:5:25 accepted internationally and by regional comparisons. * The 13 tertiary institutions (besides the three public universities) classified as higher education institutions are spread over 10 ministries. As such expansion coordination has not been easy or is non-existent. * Tanzania has also smaller pool of students which inputs into higher education than its neighboring countries. Tanzania maintains a low participation rates in secondary education, currently at 5 percent of the age cohort, as compared to 11% in Uganda and 25% in Kenya. The transition rate from primary to secondary education is 15%. Within the secondary education the transition rate from 0-level to A-level is 15%, as each year, only about 6,500 students graduate from high school out of whom about 30 percent get formal admission to universities and by the time other tertiary institutions get their share, the pool gets quite thin. * The demand for higher education in Tanzania is low. The four higher education institutions (i.e., University of Dar es Salaam, Sokoine University of Agriculture, Institute of Finance Management and the Open University of Tanzania) enroll a small fraction of the candidates with the minimum qualification for entry. University of Dar es Salaam on its part takes an average of 20% of the applicants with at least minimum required points. * The state of equity balance is likely to deteriorate due to the introduction of cost sharing and the liberalization of private secondary schools. A World Bank (1995) Social Sector Review noted that in 1994 only 1% of the Tanzanian "real poor" were likely to have completed secondary education compared to over 11% of the "better off'. Grosh and Forgy (1994)1 estimate that the top 20% of the population, in terms of wealth consume 40% of all government spending on education. * With respect to gender balance, female students have continued to be the un- favored group despite their higher rates of return on education. There have been imbalances in terms of enrolment proportions in higher education, between higher learning institutions, and between faculties/disciplines. Enrolment ratios in higher education in the 1994-2000 period have ranged between 17% and 21%. Between higher learning institutions, FY99 saw the lowest enrolment proportion of 8% being recorded by the technical colleges while the highest of 26% being recorded by the private universities. As regards faculties/disciplines, female proportions were: B.Sc. general with 5%, B.Sc. Geology with 7%, Computer Science with 6%, Engineering with 5% Grosh, M. and Forgy, B. (1994) "Incidence of Selected Social Services in Tanzania", The World Bank: Dar es Salaam. 67 and Agricultural Engineering with 0%. The higher education institutions are committed to actively correcting the gender imbalances as shown in their institutional transformation program plans. However, it has to be realized that the problem of low intake of female candidates has its roots in the whole education system right from the primary and secondary levels. * The issue of fragmentation and compartmentalization of knowledge has posed a major critique of the Tanzania higher education. For example, the Education Sector Reform and Development Program appraisal mission of 1999 observed that the education system is diffused and widely distributed such that the basic sciences are taught at three University campuses of Muhimbili University College of Health Science (MUCHS), Sokoine University of Agriculture (SUA) and University of Dar es Salaam (UDSM) resulting in duplication and poor synergy. This is also true for the tertiary institutes majoring in Commerce and Accountancy courses. * Issues of quality of outputs or graduates are normally related to issues of higher education system external efficiency and productivity. They are also related to broad higher education impact, outcomes and client satisfaction. The "Report of the Committee of the Development of a University in Northern Rhodesia (the Lockwood Report of 1964)" vindicates the argument that higher education institutions in Tanzania need to be sufficiently mature not to be unduly concerned about international standards. They have to be relevant first to their own people. Despite the above positive opinions there has been dissatisfaction with the product of the system as graduates cannot hold to a job and they show unsatisfactory work performance. The institutions appear to be aware of the problems posed by poor quality, yet they are tied to several structural problems which need resolution. * Regarding postgraduate training at the level of Masters Degree and Ph.D., there has been low enrolment. The enrolment of postgraduate students is around 550 for the four institutions: UDSM, SUA, IFM and IDM although the planned enrolment for UDSM alone is 600 by the end of 1999. Expansion of postgraduate training is necessary to provide greater access to higher level education for qualifying Tanzanian candidates and to ensure maximum utilization of the available resources. Increase in enrolment at this level will also promote research capacity and competence. 5.2.3 Financing of Higher Education 5.21 For recurrent expenditure, higher education major financing source has been the central government, followed by internally generated funds. Financial income for higher education during the period 1993 to 1999 did not decline in nominal terms though as a proportion of GDP and Government recurrent expenditure the proportion has remained stable at around 0.5% and 4% respectively. Recurrent expenditure per student was Tsh. 2800 and Tsh. 1914 for 1980 and 1993 respectively. These figures are quite high when 68 compared with other countries in the region. This situation suggests two things. First, the almost impossibility of private individuals affording to pay for higher education without subsidy in the light of low income levels and high cost of higher education relative to per- capita income. Second, the regional comparisons and trends tend to suggest that higher education expenditures in Tanzania are highly inefficient mainly because of low enrolments. 5.22 Almost all university faculties and institutes have been engaged in consultancy services and income generation. However, poor record keeping within the institutions and departments makes it difficult to establish how much is generated. For example, in FY97 UDSM alone generated around Tshs. 335,530,631 from this source; a figure equal to 5.3% of approved government budget to UDSM in the same year. 5.23 During phase three of cost sharing, the government introduced student loans to be repayable after the completion of studies. Also based on cost-sharing policy, institutions have introduced fees for private sponsored students. However, due to small size of the labor market and declining employment opportunities in the formal sector the probability of the loan repayments may be low. On the other hand the response rate for privately sponsored candidates has been very low. Indeed, according to the UDSM Private Students Fees Report (1998) during the academic year FY98 only 46 private students responded, representing less than 10% of admissions. 5.24 A major source of financing higher education activities especially capacity building and institutional strengthening has been donor funding, since for several years the government has not funded research costs and other development costs in higher education. Major donor sources include NORAD (Norway), DANIDA (Denmark), British Council (UK), Commonwealth, Dutch/MHO (Netherlands), DAAD (Germany), GTZ (Germany), Netherlands, Irish Aid/HE, (Ireland) NUFU (Norway), Swiss Government Belgian Government, International Development Research Center of Canada (IDRC) and UNDP. Experience with donor funding is that there has been a tendency of changing focus over time and this has already posed problems related to sustainability and continuity of the donor funding source. 5.25 By 1985, the salary of a senior academic was lower than what a trained graduate could earn after six years of service in several public parastatals. New salary scales for teaching staff in higher education institutions under the Ministry of Science and Technology and Higher Education became operative in July 1999. Otherwise University salaries had remained stagnant. The salaries have of late improved more rapidly than salaries in other areas. The academic monthly salaries now range between 15 and over 40 times the (annual) per capita GDP. Yet the low value of University salaries, when converted into dollars is a source of dissatisfaction and subsequent brain-drain among academics. In comparison with salaries outside the country given in dollar terms, a professor at UDSM, for example, was receiving US$ 1,000 per month in FY00 while the lowest level of assistant lecturer was receiving US$350 per month. 5.26 Suggested Remedies: Performance improvement in the sub-sector requires the following remedial actions, which are shown also in Table 5.6. * Deliberate effort to increase overall sub-sector resources through education levy measures; 69 * Control of course/program content through an accreditation body; * Creating a body to rationalize the existing capacity/institutions; * Introduce and implement affirmative measures to address gender imbalance in enrolment; * Strengthen the higher Education Accreditation Council to monitor quality, and provide enabling environment for curricular reviews and staff professional growth; * Allow institutions to be independent and autonomous; * Rationalize government resources to higher education and encourage participation of private sector. 70  Table 5.6: Main Problem Areas and Suggested Remedies for Higher Education and Technical Development in Tanzania Problem Cause(s) Remedies Small sizes of Lack of co-ordination, lack of * Creating a body to rationalize existing Institutions centralized allocation of capacity. resources, lack of rationalization. * Survey of institutions and options for their survival. * Retaining only well performing institutions for support and making them cost-efficient; redefining government role from a provider and enabler to regulator and stimulator. Low enrolment High costs in public Universities * Increase budgetary allocation to 5% of Lack of space and general GNP. capacity under utilization. * Amalgamation of small institutions. * Better utilization of staff. * Involvement of third parties in financing higher education * Encouraging off-campus students. * Targeting resources toward physical plant and facilities expansion. * Reduce management costs * Strengthen distant learning Low quality Lack of quality control and * Strengthen the Higher Education monitoring, lack of curricula Accreditation Council. reviews, lack of teacher * Provide enabling environment. specialized skills. * Retain Academic Staff. * Introduce output/student based funding mechanisms * Overhaul Curricula. Skewed Gender + Historical trends * Co-ordinate efforts between MOEC and Enrolment MSTHE on sensitization * Formal and non-formal * Resocialization socialization process. + Expansion and diversification of physical and pedagogical facilities in science schools. * Lack of sensitization * Pre-enrolment science courses for girls; * Unbalanced physical and * Provide girls scholarships. pedagogical facilities in * Remedial science for girls. schools/colleges. 71 Lack of * Heavy dependency on * Introduce Higher Education Act with Institutional government. contractual relationships; Transformations * Appointees of government. + Create own staff regulations and terms of services; * Lack of vision/mission. * Council and Boards to have greater authority; * Lack of framework for * Students to be sponsored on mutually supervisory, regulation, agreed upon terms using capitation grant. guidance, quality assurance, and incentives. Under-fuinding Low budgetary allocation and * Rationalize level of government low private sector participation. contribution; * Introduce legally protected student loans scheme; * Introduce Education Levy; * Encourage private sector to establish and maintain institutions, provide loans and scholarships, provide part time employment to students; * Encourage and reward income generation activities in institutions. 5.2.4 Analysis of Efficiency and Effectiveness of Higher and Technical Education 5.27 The efficiency of the higher education system can be measured in many ways, but it is common to look at the utilization of human, physical and financial resources. In this case we are interested in unit costs, staff-student ratios, capacity utilization and transition and wastage rates for the sub-sector. These indicators tend to suggest that there are inefficiencies that need to be addressed. 5.28 Capacity Utilization: Higher education institutions need to utilize efficiently their fixed and variable resources and assets so as to cut down the unit costs. The most valuable fixed resources are the teaching facilities, the leaeing resources and the utilities. Data from UDSM transformation program (1999) suggest for example that no room is fully utilized. Room utilization rates are: 68% at UDSM (main campus); 43% at MUCHS and 89% at UCLAS. 5.29 Teacher-Students Ratios: The teacher-student ratio is one of the basic criteria for optimal utilization of the available teaching, research and consultancy resources. Table 3.7 suggests that the ratios are generally high by regional average, mainly because of low enrolments and small size institutions. This trend results in high unit costs and high proportion expenditure on personal emoluments as compared to expenditure on other charges within an institution. 5v30 High-Unit Costs: One of the challenges facing both the government and the institutions is to reduce the high unit costs due to low student/staff ratios. Tanzania higher education unit costs are higher than those found in other African Universities. By 1997 the unit costs at UDSM and SUA were US$ 6,071 and US$ 10,188 respectively. On the other hand the average public per unit expenditure per student also remains high at US$3,300 for SUA and at US$ 2,800 for UDSM. During the same period the unit costs in 72 comparable countries were: University of Zimbabwe, US$4,308; US$3,298 at University of Zambia and they were US$1,325 at Kenyatta in Kenya (GoT, MSTHE, 1998)16 Table 5.7: Teacher-Student Ratios in Selected Higher and Technical Education FY97 FY98 FY99 UDSM 1:7 1:7 1:7 SUA 1:5 1:6 1:3 MUCHS 1:2 1:2 1:5 UCLAS 1:3 1:5 1:3 DIT 1:14 1:15 1:10 MOSHI CO-OP 1:2 1:2 1:2 KARUME - 1:10 1:9 IFM 1:11 1:17 Source: Computed from MOSTHE Basic Statistics (1999) Wastage: 1991 1992 1993 1994 1995 1996 1997 Arts (0.10) (0.07) 0.04 0.03 (0.14) (0.15) (0.06) Commerce (0.24) (0.20) (0.19) (0.23) (0.15) (0.14) (0.14) Education (0.17) (0.07) (0.00) (0.13) (0.13) (0.12) (0.07) Engineering (0.11) (0.10) (0.17) (0.08) (0.05) (0.15) (0.19) Law (0.04) (0.07) (0.02) (0.01) (0.07) (0.00) (0.05) Science (0.50) (0.44) (0.39) (0.48) (0.38) (0.34) (0.32) Pharmacy (0.48) (0.53) (0.63) (0.49) (0.38) (0.04) (0.60) Nursing - - - - (0.52) (0.62) (0.70) Medicine (0.47) (0.54) (0.49) (0.56) (0.33) (0.31) (0.20) Dentistry - - - (0.44) (0.61) (0.40) N.A Source: Computed from Cohort progression reports and undergraduate Students' performance reports. Notes: Cohort length is 3 years for Law, Arts, Commerce and Science; 4 years for Engineering and Education and 5 years for Medicine and Dentistry. 5.31 Analysis of Personal Emoluments and Other Charges: Interestingly, the proportion of expenditure covering students' welfare in higher learning institutions has remained high (over 20%) and growing even after introduction of student loans, which are supposed to meet accommodation and catering costs. In terms of the pattern of spending, Tanzania compares favorably with Belgium and France, but badly with other African countries, Japan and Sweden. Students' welfare takes a high budget of UDSM when compared with industrialized countries. Funds for operational costs are smaller in Tanzania often at the cost of education quality. Cost sharing through the Student Loan Scheme is yet to prove effective. This is because, graduates through this program have not started repaying the funds from the loans they received. At the same time, the government has not established an effective mechanism to track down graduates so as to get the money back nor has the revolving fund account been established. Within the 16 United Republic of Tanzania (1998) "Financial Sustainability of Higher Education: A Report of the Task Force on Financial Sustainability of Higher Education in Tanzania'. MSTHE: Dar es Salaam. 73 institutions themselves Personal Emolument (PE) consume a high proportion of public allocations as compared to the share of other charges (OC). Table 5.8: Proportion of Funds Allocated to Various Expenditure Items for Universities in Africa, Europe and UDSM. Item Africa Belgium and Japan and UDSM France Sweden Personal Emoluments 46 75 48 68 Student Welfare 31 4 7 20 Operating costs and material 23 21 45 12 100 100 100 100 Source: URT (1998) Financial Sustainability of Higher Education in Tanzania, p. 60. 5.32 Suggested Remedies: Performance improvement in higher education requires the following actions shown also in Table 5.9. * Dramatic increase in enrolment- * Rationalization of institutions and capacity utilization; * Improved management of institutions and reduce managerial costs; * Establishing mechanism to track down loaned money from graduates; * Increased employment opportunities; * Establishing strategies that will lower unit costs. Table 5.9: Main Efficiency Problem Areas and Suggested Remedies for Higher and Technical Education in Tanzania Problem Cause(s) Remedies High tuition and welfare costs + High Unit Cost * Establish strategies that will * Increasing cost of living, lower unit costs; Reduce + Increasing managerial managerial costs; Reduce costs. Poverty among Tanzanians. Difficulties in recovering + Lack of mechanisms to # Establish mechanism by student loans. track down graduates. Act of Parliament to track down loaned money from graduates; * Many of the graduates do * Increase employment not secure sufficiently well opportunities paying jobs to pay the loans * Promote and support self employment initiatives. Under-utilized institutions and Unmet needs for middle cadre * Rationalize institutions; Uncoordinated courses personnel. Establish an Accreditation body for Awards and control of course content (curriculum). High Wastage Rates Weak candidates; poor teaching * Tighten entrance criteria methods/poor assessment tools. and validate assessment tools; + Provide teacher professional development. 74 5.2.5 Review of Higher and Technical Education Sub-Sector Expenditure: 1993-1999 5.33 Funding of Higher Education in Tanzania involves a multiple of sources. These include the Union Government (for both the Mainland and Zanzibar since Higher Education is a Union matter), the Government of Zanzibar, external donors, private sector entities, parents, beneficiaries (either in the form of "own" funds or student loans which have to be repaid), Non-Governmental Organizations, the institutions themselves through income generation contributions as well as the general populace through means that do not involve traditional tax and non tax revenue generation measures of the central government. An example of such means is the proposed education levy. 5.34 Regarding funding of Higher and Technical Education through Government budgetary Operations, four issues are examined. These include Government Recurrent Expenditure, Government Development Expenditure, Donor funding and other forms of funding. The analysis focuses on structure and predictability of resource flows. 5.35 Government recurrent expenditure: Table 5.10 shows trends in the funding of Higher and Technical education from recurrent budget for the years FY94-FY99. In nominal terms government recurrent expenditure has been increasing annually by between 7% and 57.9% between 1994/5 and 1998/9 while in real terms the increase has been between 0.6% and 46.7%, respectively. The proportion of Higher and Technical Education funding in total government recurrent budget shows an unsystematic pattern, initially rising from 3.3% in 1993/4 to 4.2% in 1994/5 before declining steadily to 3.7% during 1997/8. A sharp up turn to 4.7% of total recurrent government budget is experienced in 1998/9, as part of concerted government efforts to revamp the social services sector. Out of total GDP, Higher and Technical education received 0.5% annually between 1993/4 and 1996/7. This proportion shrunk to 0.4% in 1997/8 before rising to 0.6%. Table 5.10: Trends in Higher and Technical Education Funding in Tanzania 1993-1999(%). Year Govt. Recurrent Expenditure annual Higher and Technical Education changes Funding as proportion of Nominal Real Govt. Recurrent GDP Budget 1993/4 - - 3.3 0.5 1994/5 +48.0 +31.4 4.2 0.5 1995/6 +10.0 +9.1 3.9 0.5 1996/7 +17.1 +8.7 3.9 0.5 1997/8 +7.0 +0.6 3.7 0.4 1998/9 -57.9 +46.7 4.7 0.6 Source: Own Computations from data in 1.URT, Appropriation Accounts, Ministry of Science, Technology and Higher Education (various). 2.URT/World Bank (PER)(1999). 5.36 The analysis of the allocation of Government recurrent expenditure is attempted by decomposing the expenditure into personal emoluments (personnel expenses) and other charges. In Higher education, personnel expenses excluding teachers' salaries have constituted a paltry proportion of the budget. It has ranged between 0.02% during 1998/9 and 0.3% for the years 1994/5 and 1995/6. Direct student costs (excluding student loans) 75 have claimed on average 27% between 1993/4 and FY00 ranging from a low rate of 14.9% in FY00 to a high 42.4% during 1994/5. With regard to Technical education, personnel expenses have averaged 10.5% between 1993/4 and FY00, the lowest proportion being 3.5% in 1995/6 and highest being 16.6% during 1996/7. Direct student costs ranged from 0.1% during 1995/6 (closure) to a high 35.1% during 1993/4. Students in Technical education do not receive student loans as a matter of policy. On average personnel expenses consume around 5% of the government recurrent expenditure channeled to Higher and Technical education. In Higher education the average is around 0.2% while for Technical education it is around 10.5%. Student costs (excluding student loans) also feature significantly. Table 5.11 summarizes the information. Table 5.11: : Tanzania: Higher and Technical Education Expenditure By Purpose: 1993- 1999 Percent of Sub-Vote (Actual, %) 1993/4 1994/5 1995/6 1996/7 1997/8 1998/9 1999/0 A: HIGHER EDUCATION Personnel expenses 0.2 0.3 0.3 0.05 0.02 0.04 0.09 Student costs (Welfare/allowances excl. student loans) 31.1 42.4 22.3 30.5 22.4 24.9 14.9 B: TECHNICAL EDUCATION Personnel expenses 12.3 16.0 2.5 16.6 10.1 10.9 4.8 Student costs (no loans issued) 35.1 31.9 0.1 24.1 3.7 20.8 16.1 C: A VERA GE Personnel expenses 6.3 8.2 1.4 8.3 5.1 5.5 2.4 Student costs 33.1 37.2 11.2 27.3 30.3 22.9 15.5 Notes: FY00 estimates Source: Own computations from Appropriation Accounts, Ministry of Science Technology and Higher Education (MSTHE) (various) 5.37 Government Development Expenditure: Government development expenditure on Higher and Technical education has remained almost at same level for the period under study (both in proportion to total government development expenditure and to GDP as Table 3.13 shows). Historically much of the development expenditure in Higher and Technical education has been foreign financed and has not been mainstreamed in the government budgetary process. Thus the reflections of government development expenditure was very small compared to the investments that were observed to be taking place in the institutions. 5.38 As a proportion of total government development expenditure, Higher and Technical education allocation was in the order of 0.4% during 1994/5, 1996/7 and 1998/9. Only during 1995/6 did it rise to 0.5%. 5.39 In GDP terms, Higher and Technical education development budget expenditure remained at 0.01% for the entire 1994/5 - 1998/9 period. Government development expenditure declined from 1.8% in 1994/5 to 0.2% in the following year before picking gradually to 0.5% during 1996/7 and peaking to 2.5% during 1998/9. 76 Table 5.12: Trends in Government Development Expenditure in Higher and Technical Year As % of Total Govt. As % of GDP Development Exp. THE GDE 1994/5 0.4 0.01 1.8 1995/6 0.5 0.01 0.2 1996/7 0.4 0.01 0.5 1998/9 0.4 0.01 2.5 Notes: THE = Technical and Higher Education allocation GDE = Govt. Development Expenditure Source: Own Computations from MSTHE and URT/World Bank documents. 5.40 A notable feature from Table 5.12 is that even when Government development expenditure increased during 1998/9 (as proportion of GDP) there was no corresponding (or any) increase to the allocation to Higher and Technical education. Within the sub- sector, allocation has tended to favor higher education, receiving 98.2% of total sub- sector allocation during 1994/5; 70.5% during 1995/6; 76.1% during 1997/8 and 91.2% during 1998/9 (computations from sources in Table 5.12). 5.41 Donor Funding in Higher and Technical Education: The expenditure by Donors in Higher and Technical education follows the pattern of the budget as a whole - funding development programs. 5.42 Tracking donor funds in the main government budgetary framework has been a traditional difficulty in the past. However, despite recent efforts to reflect donor funds in the government budget, tracking is still not an easy task. For the years we could make two observations: One, the proportion of local (government) funds is less than donor funds e.g. for 1994/5 local funds made up only 13.9% of total development funds to the sub-sector. The proportion improved to 58.7% during 1995/6 and to a further 69% during 1998/9. Secondly, foreign financing was fully directed to Higher education with none to technical education. 5.43 Recent moves in other sectors e.g. health promise to keep better records and better monitoring of donor expenditures through creation of a common basket. Though experience with common basket funding is limited, it might be a useful approach for donor funding of Higher and Technical education. 5.44 Other Sources of Finance for Higher and Technical Education: The group of "other sources" includes private, own funding, student loans, NGOs, etc. The funding from this group is the most difficult to track as information is very scattered. However given recent reforms in the economy in general and education sector in particular, this is the source that is expected to play a leading role in the future. A comprehensive study on the potentialities of this source will be most welcome. Perhaps one can make remarks on one source that is the student loan scheme. A weakness like low (or no) recovery rates is not only experienced in Tanzania but also in other African countries like Kenya, Zimbabwe, Botswana, etc. A comprehensive evaluation will shed more light. 5.45 Predictability of Resource Flows to Higher and Technical Education: This section analyzes predictability of resources to the sub-sector from three sources: government recurrent budget, government development budget and donor financing (for 77 years with complete data). Table 5.13 summarizes the results. With regard to Government Recurrent expenditure, on average about 87% of the approved estimates are actually disbursed and spent. The lowest score was 81.7% during 1995/6 and the highest was 96.9% during 1998/9. Donor finances do not usually fund recurrent expenditure. The predictability of development expenditure differs substantially between government and donor sources. The average success rate for the former is 77.6% (highest, 100% during 1998/9; lowest, 24.6% during 1995/6); while for the latter it is 34% (highest, 100% during 1994/5; lowest, 0% during 1997/8) (as reflected in Appropriation Accounts). Table 5.13: Predictability of Resource Flows to Higher and Technical Education in Tanzania (%) 1994-1999* Year Recurrent Expenditure Development Expenditure Govt. Donor Govt. Donor 1994/5 88.0 n.a 97.3 100.0 1995/6 81.7 n.a 24.6 5.7 1997/8 80.4 n.a 88.5 0.0 1998/9 96.9 n.a 100.0 30.0 Note: *Computed as actual expenditure as a proportion of approved estimates. Source: Own computations from Appropriation Accounts MSTHE (various) 5.46 Government recurrent financing scores highly in terms of predictability. This is not very surprising given the fact that the budget cycle in Tanzania allows a foresight in the likely allocation through the indicative ceilings given to programmes. With respect to donor financing common observations have included lack of honouring already made commitments and delayed disbursements within the financial year. 5.47 Predictability of resources in Zanzibar is equally low, as the budgeted sum has been declining from year to year e.g. from TShs. 463 million during 1992/3 to TShs. 230 million during FY00. Predictability ranged between 30% (FY00 for first seven months to the highest 96.3% recorded during 1997/8). 5.2.6 Policy Recommendations 5.48 In view of the analysis the following are the recommendations: * In the short and medium terms Higher and Technical education has to be seen to be demand-driven. Measures which address this, are immediate improvement of sub-sector management, institutional development and capacity building - i.e., strengthening of capacity to monitor progress and achievement in the sub-sector. * To institute mechanisms for constant monitoring of sub-sector expenditures. * To pool resource allocation in order to effect co-ordination/rationalization in an efficient manner. * Formulation of a masterplan for Higher and Technical education in order to synchronize programs and institutional plans. This will lead to implementable programs of activities. * To sensitize on the need for extra budgetary resources for financing Higher and Technical education (e.g. through supporting education levy initiatives). 78 * In the short term cost effectiveness has to be emphasized especially through expanding enrolments in existing institutions in order to increase capacity utilization, with due attention to increasing educational opportunities for women at the tertiary level. 79  6. HEALTH SECTOR 6.1 INTRODUCTION Background 6.1 The Health Sector has registered remarkable progress since the 1967 Arusha Declaration. The sector's emphasis has been on rural health development as a strategy for equitable distribution of health services. Despite the general improvement in the health and family status, the low growth of the economy particularly in the early 1980s with associated poor health services resulted into high infant and maternal mortality rates. Analysis of disease patterns and trends show that over 70 percent of life years lost in Tanzania are caused by the top ten major diseases, which are communicable but preventable, such as malaria, diarrhea, prenatal/maternal conditions and HIV/AIDS related diseases. Health Sector Reforms 6.2 Major reforms have been initiated and proposed by the ministry to rationalize the roles and responsibilities in the provision and financing of the health services. The reforms will focus on ensuring a more transparent, cost-effective use of existing and future resources through emphasis on priorities towards outcomes rather than inputs; and on improving delivery, quality and impact of essential health care to the poor. It is noteworthy that, the health sector reform is embedded in the wider context of Civil service and local government reforms. 6.3 Regarding the use of resources, a disproportionate amount is spent on personal emoluments (over 70%), at the expense of resources allocated towards the actual delivery of health services. Moreover, despite the government's emphasis on equitable distribution of health services, available evidence indicates that the personnel distribution heavily favors the urban areas consisting of about 20% of the population and yet served by about 70% of the total workforce. 6.2 HEALTH POLICY OBJECTIVES 6.4 The overall objective of the Government of Tanzania's health policy is to improve the health and well-being of all Tanzanians with a focus on those most at risk and to encourage the health system to be more responsive to the needs of the people. To achieve its overall objective, the Government of Tanzania aims to: (i) Reduce infant mortality rates from 88/1000 live births (1997) to 84/1000 live births by the year 2002. Reduce maternal mortality rates from the range of 200- 700/100,000 live births (1997) to the range of 200-500/100,000 live births by the year 2002. GoT also expects to increase life expectancy of males from 49 years as at 1997 to 50 years by 2002 and for females from 51 years to 52 years, through the 80 provision of adequate and equitable maternal and child health services, promotion of adequate nutrition, control of communicable and preventable diseases and treatment of common conditions of illness (ii) Ensure that quality health services are available and accessible to all in urban and rural areas within reachable distances at low travel costs (from 72% as at 1984 to 90% by 2002) (iii) Move towards self sufficiency and equitable distribution of human resources by training all cadres required at all levels (iv) Sensitize the community on common preventable health problems and improve capacity at all levels of society to assess, analyze problems and design appropriate action through genuine community involvement (from 50% as at 1996 to 80% by 2002) (v) Promote awareness in government and community at large that health problems can only be adequately addressed through multi-sectoral co-operation and sector wide approaches (vi) Create awareness through family health promotion that responsibility for one's health rests squarely with the able bodied individually as an integrated part of the family. 6.3 STATUS OF THE HEALTH SYSTEM 6.5 The Health System Network: The Tanzanian health network consists about 4844 facilities that are well distributed across the country. Out of these facilities, 2877 belong to the government. Out of the government owned facilities, 284 are health centers and 2512 dispensaries providing primary care services. These are in turn linked to 81 hospitals that include district and regional hospitals as well as Muhimbili National referral and teaching hospital. Where government district hospitals do not exist, the areas are served by voluntary agency hospitals that are supported financially by the government through subventions. However, most of the government facilities are reported to be in need of heavy rehabilitation. 6.6 Human Resources: The health sector workforce is large and young consisting of about 67500. However, this figure does not include the unemployed health professionals whose number is reported to be significant. About 50% are reported to be either lowly trained or unskilled. About 73% are employed in government facilities while another 7% are seconded by GoT to Voluntary Agency hospitals hence GoT employs 80% of this workforce, spending over 70% of its recurrent budget on personal emoluments. Whereas the government spends a large percentage of its recurrent budget on personal emoluments for the health work workers, productivity is low. 6.7 Drugs and other medical supplies: It has been estimated that the country requires about US$1.23 per capita to meet its drug needs. A household survey has also established that on average Tanzanians spend about US$ 3 per capita of their income on purchase of drugs (MOH, 1998). The Ministry of Health has declared drugs allocation a protected item on the budget. However, studies have shown that more funds are spent on 81 provision of drug kits for health centers and dispensaries as opposed to drugs for hospitals that are traditionally more expensive (Pavignani 1998). 6.8 Financial Resources: The health sector is mainly funded by the exchequer, donors and contributions from members of the community. Donors mainly support vertical programs like EPI, control of STDs and HIV/AIDS and the TB and Leprosy programs among others. There has been failures by some of the donors to release all their financial commitment to the health sector in several occasions. Trends in the government expenditure on health therefore indicate a notable under-funding at all levels of the sector. 6.4 PUBLIC EXPENDITURE PERFORMANCE Background 6.9 The FY00 public expenditure review is a follow up of the last PER exercises conducted in 1997 and 1998. It aimed at supporting the preparation of the Medium Term Expenditure Framework (MTEF) in order to strengthen budget management in Tanzania specifically in the health sector. A number of studies (e.g. Recurrent cost projections, Performance Indicators, Expenditure Tracking, PER FY98 and costing of the Essential District Health Package) have already been carried out in the health sector. PER FY00 aimed at building on the previous studies to provide room towards accurate measurements of spending trends needed to analyze the effectiveness of fiscal interventions and system evolution. Analysis of Expenditure Trends in the Health Sector 6.10 For the past two years, the amount of funds released was more than what was budgeted for the sector (Table 3.15). This was due to shortage of drugs in most of health facilities, which forced the government to allocate extra funds to the sector. The increases were around 23.75 percent in FY98 and FY99, while the actual expenditures in the same financial years were over and above the budget. In FY98 and FY99 actual expenditures were about 9.08 and 14.04 percent over the respective budgets. Expenditure trends at regional and district levels are difficult to obtain as they are aggregated with other sectors' expenditures. However, it is estimated that the Ministry of Health expenditure alone accounts between the range of 40-50 percent of all public health expenditures. 82 Table 6.1: Government Budgets and Actual Expenditures for Health Sector in Billion Tanzania Shillings. FY98 FY99 FY00 Actual/budget(%) Budget Actual Budget Actual Budget Actual 1997/8 199819 (Feb. 2000) Recurrent Expenditure MoH 22.03 25.86 28.90 37.15 31.60 18.59 117.00 128.55 Regions 7.25 7.25 8.40 8.40 9.24 4.80 100.00 100.00 Local 12.90 12.90 14.90 13.98 16.39 8.13 100.00 93.80 government Total Recurrent 42.18 46.01 52.20 59.53 57.23 31.52 109.08 114.04 Development Expenditure MoH Local 1.97 1.97 2.00 1.99 3.38 1.00 100.00 99.61 Foreign 23.99 3.25 19.49 9.60 20.00 1.37 13.54 49.28 Regions/Local 1.38 1.38 1.36 1.26 0.40 0.20 100.00 92.64 government Total 27.34 6.60 22.85 12.86 23.78 2.58 24.13 56.26 Development Total Health 69.52 52.61 75.05 72.39 81.31 33.90 75.67 96.45 Source: Ministry of Finance. Sub-Sector Budget Allocations 6.11 Table 6.2 shows the MoH's FY99 budget allocations across sub-sectors of central administration and roles of hospitals and institutions under the ministry. The sub-sector breakdown shows that 40.7% of the total spending was allocated to hospitals to maintain the already existing infrastructure, 4.65% to National Institute of Medical Research and the Tanzania Food and Nutrition Center. Muhimbili Medical Center alone consumes 17.3% of the Ministry's budgetary allocation. This situation suggests that the Government policy on giving priority to primary health care (PHC) is not yet in place as far as allocation of resources is concerned. However, this might be because the Government has to fund salaries and maintaining the existing health infrastructure. The explanation above could not take into account the allocations in regions and local government where most of preventive activities take place. 6.12 A critical analysis of PE costs reveals that a substantial amount is spent on District Designated Hospital and Voluntary Agency owned hospitals. Subventions to these hospitals are mainly in the form of seconded personnel. It is high time now to rethink whether the Government should continue to subsidize Voluntary Agency health facilities. There is a need to review the coverage of health facilities to identify scope for rationalization, particularly where mission and government facilities overlap. This will form the basis for review of policies regarding subventions. 83 Table 6.2: Sub-services/Functions Breakdown of Government Recurrent Budget for Health - FY99 PE* OC* Total Bn. % Bn. % Bn. % Shs. Shs. Shs. MoH Admin/Central** 2.40 18.60 13.40 83.60 15.80 54.90 Muhimbili Medical Center 4.20 32.60 0.80 5.00 5.00 17.40 KCMC hospital 0.90 7.00 0.40 2.50 1.30 4.50 District Designated Hospitals (DDH) 2.03 15.80 0.60 4.00 2.63 9.10 Bugando Hospital 0.52 4.04 0.40 2.50 0.92 3.20 Muhimbili Orthopaedic Institute 0.31 2.41 0.10 0.60 0.41 1.40 Ocean Road Cancer Institute 0.21 1.63 0.10 0.60 0.31 1.10 Voluntary Agency (VA) hospitals 1.10 8.50 0.05 0.30 1.15 4.00 National Institute for Medical 0.80 6.22 0.09 0.60 0.85 2.90 Research (NIMR) Tanzania Food and Nutrition Center 0.40 3.11 0.05 0.30 0.45 1.60 (TFNC) TOTAL 12.87 100% 16.03 100% 28.82 100% *PE are personal emoluments, OC are other charges. Drugs costs have been allocated to various levels of health care based on information supplied by Medical Stores Department. **MOH/Admin/Central includes MOH administration, accounts, planning and nursing sections, the Government Chemist service and Tanzania Food Commission. Analysis of Health Sector Funding Requirement 6.13 The definition of sector funding "needs" has to be set in the context of what might be affordable at the country's level of development and incomes. The World Development Report (1993) recommends US$ 12 per capita for provision of a basic package of health services in developing countries. Based on this assumption, the overall funding needs for the health sector in Tanzania would be US$ 360 million based on the 1999 population figures of about 30 million people. 6.14 In order to run services at optimal levels, about US$ 150-180 million is required for the sector (Pavignani 1998, HERA 1999). It is, however, estimated that currently less than US$ 100 million is available to the sector from all sources, with the Government of Tanzania and donors providing the bulk of the resources. Based on various assumptions, the cost of running the government Health sector is estimated at US$ 126 million in 2001 rising to about US$ 132 million in 2002. Priority Areas 6.15 In order to improve the delivery of health services, the priority will be to strengthen the delivery of the essential district health package as well as to arrest the further deterioration of the physical facilities. Provision of drugs will continue to be a protected item in the budget. The following priority areas are therefore recommended. 1. Drugs and essential medical supplies 2. Kerosene for storage of vaccines in rural areas 3. Essential hospital equipment and supplies 4. Strengthening of the referral system 84 5. Equipment for safe motherhood for all levels (vaccines, delivery beds and kits etc) 6. Conditional survey of physical facilities and equipment and prioritization for urgent rehabilitation of the most critical ones 7. Mechanisms for introduction of CHF and cost sharing to lower level facilities Mechanisms for implementation of the National Insurance Fund. Table 6.3: Funds Requirements and Proposed Allocation of Funds for Priority and Activities in the Health Sector. (Millions of Tshs). Priority Area/Activity Estimates Projections 1999/0 2000/1 2001/2 2002/3 Reqts. Propsd. Reqts. Propsd. Reqts. Propsd. Alloc. Alloc. Alloc. Drugs 9500.00 17600.0 11610.4 19360.0 18178.9 20134.4 25474.5 Essential Medical Supplies 2664.63 5500.0 3627.07 6000.0 5634.43 6240.0 7894.5 Essential hospitals equipment 3197.55 6500.0 4286.54 7000.0 6573.5 7280.0 9210.29 and reagents (diagnostic equipment X-ray inclusive) EPI - Kerosene 266.46 600.0 395.68 700.0 657.35 728.0 921.03 Utilities for hospital and 53.26 120.0 79.14 150.0 140.86 156.0 197.36 Training Institutions Strengthening referral hospitals - 1065.85 2500.0 1648.67 3000.0 2817.22 3120.0 3947.27 provide PHC units with drugs, equipment and trained staff Define the referral functions of 639.51 1500.0 989.20 2000.0 1878.14 2080.0 2631.51 secondary and tertiary curative services (referral facilities no longer attend health center cases) Counterpart funds for the 639.51 400.0 263.79 200.0 187.81 208.0 263.15 introduction of CHF and cost sharing to lower level health facilities Start up cost and counterpart 266.46 200.0 131.89 100.0 93.91 104.0 131.58 funds for introduction of National Health Insurance Immunization of 2 years kids for 266.46 1874.40 1079.6 1187.20 7 1% to 75%. HIV/AIDS awareness campaign 0.00 4846 4731.0 4680.00 Total recurrent 15973.84 34920.0 29752.8 38510.0 41972.7 40050.4 56538.4 Total development 2874.75 20840.0 4422.68 23670.0 4375.0 24616.8 4375.0 Total resources priority areas 18848.59 55760.0 34175.4 62180.0 46347.7 64667.2 60913.4 6.16 Apart from the above items, other areas of priority that are required for developing institutional infrastructure for sustainability in health care delivery are: 1. Improved health education strategies 2. Development and institutionalization of the health sector reform strategies. 85 Proposals for the FYO1 Budget 6.17 To make the budget preparation realistic and to help achieve the stated goals and objectives and improve the output, the following proposals are recommended: 1. Reduce the number of unskilled staff and institute mechanisms for rational distribution of staff by transferring some skilled staff to PHC. This will have a twofold effect of releasing resources as well as addressing the issue of quality of services provided in the PHC units. 2. Strengthen supervisory teams to check on treatment protocols and irrational prescriptions. 86  7. WATER SECTOR 7.1 INTRODUCTION Water Sector PER Objectives for FY01 7.1 The objective of the FY00 PER for the water sector was to provide a brief update of water policy objectives and budget performance, issues and options in the water sector during 1997/9 - FY00. The update focuses specifically on the current status and performance of rural and urban water supply and water resources management during the past three years. Also, the review provides a budget outlook for FY01 and indicative expenditure plans for the Ministry of Water for at least the next three years (FY01 - FY03), linked to the expected water sector outputs. Options for improving the impact of the budget on the water sector performance are also mentioned in this PER. Thus the FY00 PER for the water sector was to assist the Government (MOF) in the preparation of the FY01 Financial Year Budget Guidelines and the MTEF for FYO1 - FY03. PER Study Approach and Methodology 7.2 The study's approach and methodology aimed at capacity building in PER analysis in the Ministry of Water and maximization of the transfer of skills to counterpart staff. 7.2 ISSUES RELATED TO BUDGET PERFORMANCE FOR FY98-FYOO Total Budget 7.3 The budget performance for the Ministry of Water between FY98 to FY00 showed an oscillating but poor budget track in actual expenditures. The trend indicates that the commitment of the GoT budget to Ministry of Water has been very low, not only in terms of its allocations, but more important in terms of what actually is availed to the sector. Capital Budget Issues 7.4 Over time, the GoT budget has increasingly become dependent on donor funds, at an average of about 60 percent, to finance its annually planned (total) budgets for the Ministry of Water. For example, more than 90% of the approved development budget for FY99 to the ministry has originated from foreign sources. Specific development budget issues observed include: * Declining planned, approved and actual development budget expenditure; * High dependency on foreign funds and inadequate local funds in capital budget; 87 * Increasing difficulties in commitment of counterpart funds for development projects; and * Declining trend and high divergence between donor commitment and disbursement. Recurrent Budget Issues 7.5 The recurrent budget accounted for about 50% of total actual expenditure during the 1998/9 - FY00 period. More than 70 percent of released local funds to the Ministry were spent for payment of PE. For this reason, the Ministry's service delivery and undertaking of activities such as operation and maintenance (O&M) of infrastructures, which are often financed by other charges (OC), have been under-financed. Although most urban water supply and Sewerage systems are autonomously operating and generate their own income, they still consume a large share of the recurrent budget through salaries of senior staff and O&M, especially the electricity bill, which is still borne by the GoT. Specific recurrent budget issues include: * Oscillating planned, approved and actual recurrent expenditure; * Recurrent expenditure by service or output levels is dominated by rural and urban sector. While the rural sector consumes high budget on O&M expenses, the urban sector's recurrent budget is expended for sanitation/sewerage activities. 7.6 Personnel Emoluments (PE): There has been a systematic increase in PE, mainly due to the increasing seniority and promotions of the ministry's staff; and continued reliance on many casual laborers comprising of gauge readers, pump attendants and watchmen who are employed on temporary basis mainly in the major water schemes and different water basins to collect data on water resources and do other manual works. The rising trend of wage bill implies that the PE budget destined to pay staff will continue to increase directly with staff's seniority and promotions. 7.7 Other Charges (OC): The expenditure for other charges by the service levels/outputs indicates that between FY98 and FY00, the water drilling agency (DDCA) - a subcontractor to the Water Resources Division, has been leading by claiming about 66.6% of the total OC released to Ministry of Water. Water drilling is followed by the Central Water Store (10%). In fact, the OC for DDCA and the Central Water Store (CWS) used to be very small in the past, but in FY98 and FY99, the DDCA and CWS claimed a considerable amount of the MDF resources allocated to development projects to address the El Nino based water crisis experienced in Dar es Salaam. Next in terms of claiming resources were divisions such as rural water supply (8.3%), urban water supply (4.5%) and others 10.3%. 7.8 Generally, the Ministry of Water utilizes OC to most of the casual laborers employed by the Water Resources Management Division. Casual laborers are temporarily employed (some for much longer time), most of them are semi- or unskilled (particularly the gauge readers and technicians), and are paid under OC and not under PE. However, there has been insufficiency of funds (other charges) for operation and maintenance of water pumps, resulting into defective pumping systems. 88 Budget Ceiling 7.9 Though well understood and planned for, the water sector development is held back by poor budget disbursement by both the exchequer and donors. As such, most of the water problems have been and will continue to roll over for many fiscal years. Notably, the budget ceiling criteria which is applied by the Government is outdated and may derail the performance budgeting approach because it defeats/contradicts with the performance-oriented spirit in the sense that no strategic plan can be comprehensively implemented with such an expenditure approach. Therefore, a revised framework to integrate the budget ceiling with budget performance is required. Impact of Expenditure on Water Sector Development 7.10 Public expenditure investment include not only additions to water supply plant, machinery and equipment but also intangible components of services such as refined management and institutional facilities, improved quality of water supply as well as additions to the stock of human capital through training, etc. The important achievement that emerges from this study is the establishment of the prerequisite local water supply and sewerage services capability. These include improved infrastructure and support institutions, which facilitate the development of the water sector. Specific realizations comprise the following: 7.11 Sector fiscal discipline is in order: The Ministry of Water knows its expenditure priorities and how to use resource to attain the long-term water sector goals. For example, in the FY99 PER Report, a lot of financing gaps were identified. The gaps were expected to be addressed by the PER FY00. The gaps were prioritized from level 1 to 5 and totaled Tshs. 15,197,956,000. Some of the activities have already been implemented and others have to be reviewed for inclusion in the next budget proposal. 7.12 Review of Water Policy 1991 has been completed smoothly: The review of Rural Supply (a component of the 1991 National Water Policy) has been completed and has incorporated a view of strengthening the rural authorities for development and management of the rural water supply services. The rural water supply policy focuses on community participation in conceiving, planning, construction, operation, maintenance, and ownership of their rural water supply schemes. The policy provides full involvement of users at all stages of the project cycle and is based and guided by social, economic, environmental and sustainability principles. 7.13 Some rural water supply strategies have started to be implemented: * A few Water Users Associations/Trusts/Companies have been legally established. Ownership has already been transferred to these water user entities/companies. * Participatory Approach applied in strengthening the local community to manage and run their own water supply schemes in sustainable manner has been adopted. This approach provides for legal registration by the communities to operate and maintain their organization legally. 89 7.14 Urban Water and Sanitation Sector projects favored and showing sign of good performance: On Urban Water and Sanitation, the government has built up necessary institutional framework to support water sector development. The institutional impact has been the establishment of independent water authorities, with their own boards in all 20 regional headquarters. With effect from 1st January 1998 the Minister of Water declared all 18 UWSDs to be Urban Water Supply and Sewerage Authorities (UWSAs) in different levels of development and categories. For instance, five of the boards (Arusha, Dar/Kibaha, Moshi, Mwanza and Tanga) are completely autonomous. They do not depend on Government subvention for O&M, except for the capital or development expenditures. 7.15 The government sees the strengthening of rural and urban water supply authorities as advantageous since it aims to build the capacity of local authorities for self-financing and ensure the sustainability of service delivery. The success of the process will eventually reduce the burden of providing water and sanitation services by the central government. 7.16 Sector focus and shift in water sector policy priorities in the public expenditure: Since 1991 the Government has been emphasizing urban development, with a focus on Urban Water infrastructure rehabilitation. The sub-sector has been consuming over 50% of the resource allocation, in terms of both local and foreign funding. The foreign input component has been in urban water development. 7.17 Rural water has had a 20% allocation share. However, TAS and HIPC initiatives intend to support a shift towards water resource management and rural water supply. In the wake of HIPC and TAS, sector-spending prioritization has to be earmarked to the rehabilitation of inoperative rural water schemes while handing over the same to the people, thereafter. 7.3 INSTITUTIONAL FRAMEWORK AND CAPACITY BUILDING 7.18 The Tanzanian government has set up an adequate institutional framework to implement major water sector policy objectives and strategies. The role of the Ministry of Water is also changing from that of being a service provider to being a facilitator, regulator and promoter of rural and urban water supply and sanitation/sewerage services. However, it has weak vertical and horizontal linkages. It is not conducive for either the central or local government to fully manage, co-ordinate and execute the development activities pertaining to the sector all over the country. 7.19 The human resources development has been halted mainly due to lack of funds for capacity building activities such as training. The capacity building/training budget is located in the development/capital component, which is not forthcoming as planned or authorized. Attrition of the staff due to retirement, retrenchment, death, ill-motivation and voluntary termination of services has further eroded the sector of its most needed human resources. For instance, in the 5 years to come, all the heads of divisions and some units will be legally obliged to retire. This implies that no replacement will be accomplished. Due to this adverse situation, division will either be managed by under-qualified people, or will resort to expertise consultancy, which seem to be more expensive than the cost required to develop the existing human resource. 90 7.20 Unfortunately, recruitment of staff into the water sector was suspended for several years. The employment permit was delayed and interviews for the post applicants are prolonged by the Civil Service Commission (CSC), alleging that there is no money to convene such an interview. Also, the Ministry of Water has a backlog of about 800 (eight hundred staff) to be promoted by the CSC, which is claiming to suffer from budgetary financial inadequacy. Main Institutional Administrative Issues and Concerns 7.21 The following are major institutional and administrative issues and concerns for the Water sector: * Weak institutional set-up coupled by inadequate working tools, facilities and equipment, machinery and poor transport facilities, combined with an inefficient provision of water services and poor communication system within the sector. * Shortages of adequate personnel to manage water and sanitation programs (i.e., inadequate trained, skilled and motivated staff). This issues is connected to the restricted recruitment of staff, retaining of the required qualified professional and technical staff in the face of competitive attractions in the non-public sectors and poor supply of the adequately trained personnel. * It is difficult to equitably allocate water rights among competing users for the overall socio-economic development of Tanzania, while at the same time promoting sustainable development and management of water resources. * Inadequate financial resources for water sector development. 7.4 CURRENT STATUS OF WATER SECTOR PERFORMANCE Surface Water 7.22 Tanzania has an abundance of inland waters with several large lakes and rivers to meet most of the present needs. However, differences in topography, rainfall pattern and climate account for the existing variation in the availability of water in different parts of the country. Specific surface water issues include: * Scarcity, misuse and wastage of water pose a serious and growing threat to sustainable development and protection of the environment. * Increased human activities in the various catchment areas, competing and conflicting demands and land use are also impacting on the available water resources in a number of ways. Such ongoing activities are causing deterioration of the catchment areas at many places with consequent changes to runoff patterns and water balance. * The water resources are unevenly distributed nationally in space and time, and are scarce in many areas. Also, there is high variability in rainfall, diverse climatic conditions and geographical features. Rivers and lakes generally rise 91 during the rainy season and recede during the dry season. Generally, Tanzania is relatively dry. * Conservation of surface water sources against increasing pollution and degradation of the environment. Groundwater 7.23 Groundwater potential in the country is variable. It is one of the major sources of water, particularly in the semi-arid areas but still remains being not well established and developed. In general, the natural groundwater quality in Tanzania is good, acceptable for most use. Specific groundwater issues include: * High salinity (chloride) causes high evaporation rate and poor drainage, hardness and corrosion due to high carbon dioxide. * High concentration of iron or fluoride is a common problem only in the area surrounding the Rift valley system where volcanic chemicals contaminate the groundwater. * Lack of surveyed adequate data and information and mismanagement of resources. Rainfall 7.24 Tanzania has high annual rainfall. However, rainwater harvesting is mostly used as a supplement to other water supply sources in most parts of the country. Several different types of rainwater storage facilities such as tanks, dams and charcoals, have been constructed at various levels from institutions to households. Rainwater harvesting from rooftops in rural areas is gradually gaining momentum although on a very small scale. Therefore rainwater-harvesting tank construction could be a novel idea that will eventually be applied on a large scale. * Erratic and highly unreliable rainfalls and data. * Poor rooftop construction of the harvesting systems. * Lack of proper operation and regular maintenance of the harvesting systems. Rural Water Supply 7.25 The current official estimates of water supply coverage of the rural population is about 48.5% of the rural population that has access to safe drinking water within a walking distance of 400m served through different types of schemes. The main rural water supply issues and concerns include: * There is a growing demand for water supply by rapidly growing rural population. Therefore, rehabilitation and investment or development of the water sector should match with such demand. 92 * Identification of available water resources potentials, including rainwater harvesting, increased number of shallow wells, dams and charcoals, that can be developed throughout the entire country in the wet and dry season, including both surface and groundwater, and springs. * Protection and conservation of water sources and promotion of efficient use of water to ensure the sustainability of water schemes. * Protection and conservation of water sources and promotion of efficient use of water to ensure the sustainability of water schemes. * Promotion of the existing rural water through cost management system by a shift from the concept of free water to cost sharing. * Promote private sector participation (local government authorities and other private stakeholders) to ensure successful hand over from the centrally managed large rural water supplies to autonomous entities. * Promote co-ordination of the stakeholders in the water sector. The MOW has to ensure that local governments develop adequate capacities to assist communities take over the management and operation and maintenance of rural schemes. Urban Water Supply and Sewerage 7.26 Currently, there are 62 registered urban centers in Tanzania, out of which 20 are regional administrative headquarters. There are also 52 minor urban settlements in the country with some form of piped water system. The water supplies in these towns are inadequate in both the quantities produced and the coverage of the distribution network. 7.27 The sewerage coverage is about 10% and only in a few urban areas (e.g. Dar es Salaam, Arusha, Moshi, Mwanza, Tanga, Tabora and Dodoma). The sewerage system in these urban areas cover central business areas and are in poor condition. In the rest of the urban areas and other unserviced areas, septic tanks and pit latrines are commonly used. Poor excreta disposal in urban areas is the major cause of pollution of water sources, hence the source of various intestinal diseases. 7.28 The process of strengthening of rural and urban water supply authorities aims to build the capacity of local authorities for self-financing and ensure sustainability of the service delivery. The success of the process will eventually reduce the burden to the central government of providing water and sanitation services. This is an effective move of ensuring the sustainability of the water and sanitation services in the country, that calls for the process to be intensified. Specific urban water supply and sewage system issues and concerns include: * Ever-increasing demand from various socio-economic activities and rapid increase in the urban population (estimated a more than 6% p.a.) in almost all towns; 93 * All urban centers in Tanzania face frequent and critical water supply shortages due to leakage and wastage of aged water and sewerage infrastructures. There is an urgent need to combat and minimize leakage and wastage. * Deterioration of the water quality due to industrial and household pollution; which also increases operational costs. The promotion of research and technologies for the management of wastewater, with a view of protecting water resources and defluoridation, which will improve the quality of the water to be served to the people; * Urgent need of identification of available water resources potentials and the demands. Identification of the potential for rainwater harvesting and the promotion of the technology among the urban people with a view of increasing availability of water; * Emphasizing demand management approaches especially in water scarce areas and during drought periods. Irrigation 7.29 Of the total 43 million hectares suitable for agricultural production in Tanzania, only about 6.3 million hectares are under cultivation. The irrigation potential in Tanzania is estimated to be over one million hectares. However, the area under irrigation is about 175,000 hectares only, of which 120,000 hectares are under small-holder irrigation. Of the irrigated areas, about 69,000 hectares are irrigated in the Pangani basin and about 30,000 hectares in the Rufiji basin. 7.30 The Main Irrigation Issues and Concerns include: * Irrigation is the largest consumptive water user and makes the greatest impact on net water resources. * Irrigators are reported to be often in conflict with each other, and with other water resource users. Hydropower Generation 7.31 The hydroelectric power potential in Tanzania is estimated at 4.7 GW, out of which only 12% has been developed. Over 70 percent of electrical power capacity is generated at hydropower plants on Ruaha and Pangani rivers, with a total installed capacity of 280 MW and 97 MW, respectively. However, a substantial amount of the national electricity is generated at two hydro-electric power plants, at Kidatu (204MW) and Mtera (80MW), which together make up 76% of installed hydropower capacity or 51% of the total installed capacity (555MW) for the national grid system. The water flows to these power plants are regulated by the Mtera reservoir with a nominal live storage capacity of 3,200 million Cubic Meters and Kidatu with live storage capacity of 125 million cubic meters. 94 7.32 Main Hydropower Generation Issues and Concerns include: * Provision of the necessary hydrological information base for the planning, development and operation of hydropower system; * Optimal allocation that benefits the whole spectrum of social-economic demands; and * Regulating the operation of hydropower reservoirs and at the same time managing and regulating all other water uses. Conflicts in Water Uses 7.33 There exist several types of conflicts in water use for irrigation. There are conflicts between users in the same category. This is mostly common for irrigators and also upstream users causing inconveniences to downstream users, either in one furrow system or several furrow systems. Other conflicts are between users of differing categories such as between irrigation and domestic water supply, especially in the dry season when most of the water is used for irrigation; between irrigators and hydropower, whereby hydropower producers blame the upstream irrigators for massive losses of water and poor water management. Generally, irrigation downstream the major dams is affected by these conflicts, which occur mainly because of uncoordinated regulation policies. There are also other conflicts such as those between irrigators and pastoralists, which mainly involve land issues and notable by livestock migrating from place to place and trespassing agricultural lands. 7.34 Further, the linkages between regular and adequate provision of safe and treated drinking water, the individual's health status, as well as the quality and level of industrial and commercial output of goods and services in the country require an in-depth understanding and hence empirical investigation. 7.5 WATER SECTOR POLICY OBJECTIVES AND PRIORITIES FOR THE FY01 The Development and Water Sector Vision 7.35 The overall long-term goal of socio-economic development for Tanzania by the year 2025 is to attain sustainable human development with all the prerequisites for achieving a fully developed economy. The Tanzanian society of 2025 must have freed itself from abject poverty and attained a high quality of life for all people, meaning that: people will have attained respectable levels of incomes, enhanced ownership of assets, reduced vulnerability, enhanced and increased power over their own future. One of the achievements expected by the year 2025 is an increase of access to safe water from 50 percent to 90 percent of the population. In specific terms, we may believe that people, looking 25 years ahead would opt for a water future where: * Accessibility and provision of safe water for drinking and sanitation is ensured; 95 * Water supplies are adequate to support agricultural and non-agricultural production activities; * The negative effects of droughts and floods are minimized; * The use of water for human purposes takes care of and protects the environment and creatures that require water; and * Conflicts over water do not develop, neither at the local level, in the region nor internationally. Ministry of Water Mission and Water Sector Policy Objectives 7.36 The mission of the Ministry of Water has always been to achieve sustainable development and management of water resources for the benefit of all Tanzanians, socially and economically. The broad Water Sector Policy objectives are: - to increase health and productivity of the population through the provision of safe and adequate water supply and sanitation services to the maximum number of people; to provide effective water supply and waste water disposal services to commerce and industry to help maintain their productivity, as well as recognizing agricultural, power generation and recreational needs; and to identify and preserve water sources and catchment areas. 7.37 To achieve the above water policy target, the government has proposed several policy strategies as follows: * Promoting community participation, cost sharing and cost recovery in rural water supply activities; * Maintaining, rehabilitating water schemes and securing of new capital investment; * Promoting the use of appropriate technology; * Encouraging private enterprise to develop and intensify privatization; * Enhancing human resource development; * Developing water sources for urban and rural areas; * Improving efficiency in the sector; * Improving the environmental sustainability of water supplies; * Promoting conservation measures and proper management of water resources; * Undertaking institutional reform, evolving new organizational structures, enhancing capacity and promoting decentralization; and * Reviewing the regulatory and legal framework. Water Sector Priorities for FY01 7.38 In implementing these strategies, the government will be guided by the following water sector's funding priorities set in FY01, which have been identified as follows: 96 * Rehabilitation of networks for planning and design for: * Provision of institutional support to rural based water user communities. * Hydrological network. * Hydrogeological network. * Rehabilitation of drilling equipment and earth-moving equipment for water supply and sewerage systems. * Development of new water sources (Drilling of bore holes and construction of dams). * Rehabilitation of rural water supply scheme and completion of ongoing rural water supply projects (earning little budget money) * Rehabilitation of rural water supply and sewerage services; * Rehabilitation of drilling equipment and earth-moving equipment for rural water supply and sewerage services. * Establishment of water-user entities in the rural area. * Rehabilitation and Expansion of Urban water supply and sewerage systems with respect to population growth and other economic activities. That is, develop new water sources for urban water supplies and sewerage services in urban areas where social and economic activities are expanding. * Enhance capacity building, recruitment of manpower and retraining of staff (engineers, technicians, managerial professionals and other experts). * Intensification of water quality control and monitoring. * Enhance environment management and conservation measures. Options for Improving the Impact of the Budget on the Water Sector 7.39 At the moment, more funds are needed to enable the GoT to implement the water sector development projects and to accomplish the institutional reforms before it becomes a facilitator, regulator and promoter of water supply and sanitation services in Tanzania. However, the following observations depict the water sector developments. Reforms Not Well Captured in the Current Budgeting 7.40 It was noted earlier that the budget performance for the Ministry of Water between FY98 to FY00 marked an oscillating and poor track due to low commitment of the GoT budget to Ministry of Water. This has partly been the consequence of depending upon the budget ceiling determined by the GoT (through MOF) to instill realistic fiscal discipline through the cash budget system. However, declining and low flows of resources may signify a shift of government policy from a provider of public service to policy formulation, promoter and facilitator. The Ministry of Water's role is still reforming from traditional service provider to a facilitator, regulator and promoter of 97 rural and urban water supply and sewerage services. Lack of understanding of this reform and bureaucratic budget procedures may lead to poor budgetary prioritization. Ongoing Resource Deployment Reform 7.41 Ongoing Government initiatives are aimed at increasing efficiency in managing urban water supply and sanitation. All the 20 regional headquarters have independent water authorities, with their own boards. Five of the boards (Arusha, Dar/Kibaha, Moshi, Mwanza and Tanga) are completely autonomous - not depending on Government subvention for O&M. Urban Sector Rehabilitation Program (USRP) project is to further consolidate the management of these boards through the establishment of more reliable water sources. As a result, an expansion of the area served with water supply will be facilitated so that the revenue base can be widened. This will sooner or later free the central government's financial resources and manpower to be used elsewhere. Measures to Reduce Aid Dependency and Enhance Optimal Utilization of Resources 7.42 The above analysis has demonstrated the problem relating to increasing dependency on donor funds for the water sector's development. The Ministry of Water has over time designed strategies aimed at reducing foreign aid dependency. Many of these strategies have aimed at reducing the need for foreign money to finance water resource management activities and enhancing optimal utilization of water resources. The envisaged strategy is to transfer water supply and sanitation facilities from central ownership to the beneficiaries by creating an enabling environment for public companies, user entities/trustees, and the community to participate. Specific water sector strategies include: * Use of village committees; * Village water fund; * Income generating activities; and * Human resource development. Water Sector Budget Outlook for FY01 7.43 The above water sector priorities can be approximated into major Ministry of Water functions, activities and measurable output indicators such as water and sanitation services, coverage to rural population or number of people in urban areas who will have access to safe water within the stated time period. Based on water sector policies, strategies and priorities, the budget outlook is provided in Tables 7.1, 7.2 and 3.20 as follows: Table 7.1: Projected Total Budget Outlook for FY01 - 2003/04 Year FY00 FY01 FY02 FY03 Recurrent 2,803,825,000 4,218,933,420 5,371,601,328 6,839,193,217 Capital 21,508,512,000 32,239,570,500 34,901,088,819 34,875,994,320 Total 24,312,337,000 36,458,503,920 46,229,382,971 41,715,187,537 98 Table 7.2: Breakdown of Capital Budget Outlook for FY01 Code Service Levels Local Foreign Total 101 Administration & General 15,013,296 0 15,013,296 102 Finance and Accounts 0 0 0 103 Policy and Planning 81,174,124 94,358,567 175,532,691 201 Water R/Ass and Exploration 1,000,955,428 9,500,000,000 10,500,955,428 202 Central Water Store 100,426,000 0 100,426,000 203 Water Laboratory 250,702,000 424,000,157 674,702,157 301 Urban Water and Sewerage 1,501,000,466 10,583,508,764 13,084,935,230 302 Central Water Board 101,000,000 158,767,118 259,767,118 401 Rural Water Supply 505,128,043 2,088,154,702 2,593,282,751 501 Water Resource Institute 200,192,029 600,789,000 800,981,029 601 Water Drilling 1,034,400,800 4,000,000,000 5,034,400,800 TOTAL CAPITAL OUTLOOK 4,789,992,186 27,449,578,314 32,239,570,500 Table 7.3: Breakdown of Recurrent Budget Outlook for FY01 Code Service Levels Total Recurrent PE OC 101 Administration & General 291,491,593 109,107,142 182,384,451 102 Finance and Accounts 68,988,888 30,253,999 38,734,888 103 Policy and Planning 113,690,906 60,256,180 53,434,726 201 Water R/Ass and Exploration 920,659,239 556,512,071 364,147,168 202 Central Water Store 73,120,250 40,548,860 32,571,390 203 Water Laboratory 197,386,954 53,889,456 143,497,498 301 Urban Water and Sewerage 1,050,344,697 589,020,682 461,324,015 302 Central Water Board 109,607,431 66,995,864 42,611,567 401 Rural Water Supply 919,045,226 450,332,663 468,712,563 501 Water Resource Institute 234,166,550 109,866,592 124,299,958 601 Water Drilling 240,431,686 111,579,884 128,851,802 TOTAL RECURRENT OUTLOOK 4,218,933,420 2,218,363,393 2,040,570,026 99  8. ROADS SECTOR 8.1 THE ROAD NETWORK IN TANZANIA 8.1 The road network in Tanzania comprises approximately 84930 km of roads, out of which, 10230 km (12%) are trunk, 24700 km (29%) are regional and 50000 km (59%) are district (Table 8.1). According to the Ministry of Works (MOW) estimates road network consist of 10840 km (13%) good, 20803 km (24%) fair and 53287 km (63%) poor condition. About 38% of trunk roads and 1% of regional roads are paved, while about 62% of trunk roads and 99% of regional roads are unpaved. The bulk of the road network (63%) requires rehabilitation. Only 37% of the road network requires routine and/or normal period maintenance. This in turn has important budgetary implication. Table 3.21 presents currently available information on the length and condition of the road network as presented in the survey carried out in May 1999. Table 8.1: Road Network by Type Surface and Condition (in km) Type of Road Condition of Road Network 1999 Good Fair Poor Total Trunk Roads Paved 2317 (59%) 1163(30%) 441(11%) 3921 (100%) Unpaved 776(12%) 2858(45%) 2675 (42%) 6309(100%) Total Trunk Roads 3093 (30%) 4021 (39%) 3116 (30%) 10230 (100%) Regional Roads Paved 22 (10%) 156 (70%) 45 (20%) 223 (100%) Unpaved 2100(9%) 5731 (23%) 16646 (68%) 24477 (100%) Total Regional Roads 2122 (9%) 5887 (24%) 16691 (68%) 24700 (100%) 3. DISTRICT ROADS Total District Roads 3995 (8%) 9755 (20%) 36250 (73%) 50000 (100%) TOTAL ROADS 9210(11%) 19663 (23%) 56057 (66%) 84930 (100%) Source: Ministry of Works 8.2 GOVERNMENT VISION FOR THE ROADS DEVELOPMENT 8.2 The road sector is one of the central sectors in the Tanzania economy and is crucial for the sustainability of the country's economic development. The share of road transport in overall GDP is about 5%, while the share of transport equipment in gross fixed capital formation is about 37%. Road transport is a major mode of passenger transport, and also handles about 70% of the internal freight traffic and 64% of the transit cargo. In addition, road transport dominates other modes of transport in terms of employment creation. The vastness of the country and the dispersed nature of the population, business and economic activities add to the strategic importance of the roads sector to the country. 8.3 The Tanzania Development Vision 2025 accords very high priority to investment in infrastructures. Specifically, the development of the road network is judged to be 100 absolutely essential for promoting rural development. Within the context of the Vision, the road sector is required to facilitate wealth creation and equitable distribution of the benefits arising from growth. The roads sector is also required to facilitate the creation of a strong, diversified, resilient and competitive economy, promote rural development, stimulate investment and other income generating activities and ensure wider participation by the Tanzanian community in markets. 8.4 The Government's mission and vision for the development of the sector is thus focused at improving the national road network. In this case the Government agrees that no sustainable and meaningful socio-economic development can take place in the regions and villages while the condition of roads is bad. Poor roads will not allow for the full exploitation of the national human and natural resources that would lead to a higher growth of the economy. An improved national road network would consist of roads that are good for vehicles to drive on under all whether conditions. Also it would offer the shortest possible road link between different geographical locations, both in urban and rural areas, to facilitate production, distribution and marketing of all kinds of goods and services. 8.3 ROLE OF PARENT MINISTRIES 8.5 The responsibility of administration and management of the road network is presently shared between MOW and MRALG. However, from 1st July 2000, the new semi-autonomous road agency "TANROADS" took over the maintenance and development role of MOW. MOW manages the trunk and regional roads, including planning, designing, constructing, improving and maintaining the roads hereunder. On the other hand, MRALG is responsible for allocating and distributing resources from the Road Fund to the districts, where the local administration is responsible for road maintenance and development. GoT is committed to remaining the principle financier of maintenance, rehabilitation, and upgrading activities. On the other hand, the above mentioned activities are to be carried out by independent contractors and not by Government departments or agencies. 8.4 THE ROAD FUND 8.6 The Government has adopted a new institutional structure for the roads sector. Under the new set up, the government has amended the Road Toll Act in order to create a dedicated Roads Fund, a Road Fund Board and a road agency - TANROADS. The current act provides for ring fencing of revenues from the road toll so that they will be used primarily for maintenance works for trunk, regional, district and feeder roads. The road funds are being managed by the Road Fund Board, which includes private sector representatives to ensure that the interests of the stakeholders are addressed in the maintenance of roads. 8.7 The Road Fund is dedicated to the maintenance and upgrading of trunk, regional and district roads. Revenue for this fund is obtained from a user charge on fuel consumers. Under this system, the road users are charged a fuel levy of Tshs 80 per liter of fuel (Tshs. 70 per liter before the FY01 budget) The funds are collected by the oil companies at the time that the fuel leaves the bonded warehouse. These funds are paid to the Commissioner of Customs who deposits them into the Road Fund Account of the 101 MOW (70%) for trunk and regional and the MRALG (30%) for district and feeder roads. Of these allocations, only 10% may be used for development of the road network whereas the remainder is earmarked for maintenance operations. 8.8 The road fund has in previous years been managed by the MOW. In line with the current changes in the institutional set up, where the Road Fund Board has been created, the Road Fund is managed by a Board which is also the policy organ for directing the activities of the road agency TANROADS. 8.5 THE "NEw" MOW AND TANROADS 8.9 The ongoing institutional reforms have a bearing on the future role of the MOW in the road sub-sector. The Road Fund Board is replacing the MOW role of managing the resources form the Road Fund. Establishment of the TANROADS on the other hand has taken away the MOW responsibilities of maintaining, rehabilitating and upgrading the trunk and regional roads. The ongoing Local Government reforms will also change the nature of resource flows from the Central Government to Local Authorities. Under the new structure resources from the road fund will flow in the form of block grants to the Local Authorities. This will replace the current practice of allocating the funds through the MRALG. 8.10 In view of the above changes, the role of MOW has been limited to policy formulation, strategic planning and regulation of the TANROADS and Road Fund Board, including donor co-ordination. 8.6 MOW OVERALL EXPENDITURE PERFORMANCE FY98-FYOO 8.11 Despite the observed growth in Government's revenue and subsequent allocation to MOW, total allocations have fluctuated over the past few years. In most cases actual releases have been far less than originally budgeted. This has been the case for both the development and recurrent budget as shown in Table 8.2. In FY98 for instance, only 63% of development budget and 77% of recurrent budget were made available. During the FY99 no allocation was made to the MOW development budget. This can partly be explained by priority that was given to emergency repairs of roads following EL-NINO rains in that year. Again in FY99, actual recurrent allocation to MOW was higher than the budgeted amount by 2% due to the fact that development funds were dedicated to the maintenance of road infrastructure that was destroyed by the EL-NINO rains. To a large extent these variations have affected the ability of the ministry to meet its financial obligations on road maintenance and rehabilitation. Table 8.2 gives the allocation of resources to the road sector for FY98 to FY00. 102 Table 8.2: Government allocation of resources to the road sector (in mill. Tsh.) FY98 FY99 FY00 Budget Actual Actual Budget Actual Actual Approve as % as % d Budget Budget Budget 1. Total Domestic Revenue 695300 661233 95% 733276 689325 95% 777200 2. Allocation to Ministries Development 24471 12711 52% 8000 4307 54% 20000 Recurrent 563682 528300 94% 622444 453800 73% 787085 2. Allocation to MOW Development 3952 2500 63% - - - 2927 Recurrent 23046 17779 77% 37189 38091 102% 32485 Rec. Alloc. To MOW of which PE 1568 2384 152% 1932 1858 96% 2479 of which OC 21478 15395 72% 35257 36233 103% 30006 Total 26998 20279 75% 37189 38091 102% 35412 Allocation to Roads Development 3952 2500 63% - - - 2927 Recurrent 20358 15835 78% 23083 19334 84% 26391 Total 24310 18335 75% 23083 19334 84% 29318 Roads as % of Ministries 4% 3% 4% 4% 4% Rev. from the Road Fund Total collections 33745 17000 52% 46000 38395 83% 40476 Allocation to MOW 20000 15000 75% 32250 31777 99% 28333 Alloc. to MOW of which Development (10%) 2000 1500 75% 3225 3178 99% 2833 Recurrent (90%) 18000 13500 75% 29025 28599 99% 25500 Source: Ministry of Works. 8.7 MOW EXPENDITURE ON ROADS 8.12 MOW expenditure on roads (i.e. trunk and regional roads) over the past few years has centered on three main areas: Emergency maintenance of roads such as those caused by EL-NINO rains during FY98; Roads maintenance of rehabilitation/upgrading; and Implementation of priority and upgrading projects (ongoing projects under IRP). 8.13 From Table 8.3 it can be observed that for the two years FY98 and FY 99, more emphasis has been on the roads rehabilitation (i.e. 63% and 56% of the total respectively) as compared roads maintenance ( i.e. 37% and 44% of the total respectively). Again, when one looks at the actual expenditure on maintenance and rehabilitation, it is clear that trunk roads has received higher weight than regional roads. This confirms the importance of the trunk roads as the main transport arteries and the priority on these roads being based on the population served, agricultural output, mining, tourism, and impact on regional co-operation. 103 Table 8.3: Resources allocation for road maintenance and rehabilitation (mil. Tsh.) FY98 FY99 FY00 Budget Actual Actual Budget Actual Actual Approv as % as % Budget Budget Budget Road maintenance Trunk Roads 11057 7391 67% 12250 15627 128% 37251 Regional Roads 8914 4028 45% 15310 8982 59% 10151 Total maintenance 19971 11419 57% 27560 24609 89% 47402 Road rehabilitation Trunk Roads 25493 17388 68% 42622 29264 69% 30716 Regional Roads .. 1937 2010 Total rehabilitation 25493 19325 76% 42622 31274 73% 32521 GRAND TOTAL 45464 30744 68% 70182 55883 80% 79923 Total Maintenance % 37% 44% Rehabilitation % 63% 56% Source: Ministry of Works 8.8 LOCAL AUTHORITIES EXPENDITURE ON ROADS 8.14 LAs expenditure on roads is for district and rural roads, where the councils has the responsibility of managing these roads under the co-ordination of the MRALG (formerly by the PMO). In this case "district roads" comprise roads that link district headquarters with ward centers, important centers within the district and important centers within the high class road. While the MOW figures show that district roads constitute 59% of the total road network, data from 1999 survey by Inter Consult indicate that district roads constitute 33.6 of the total road network in Tanzania. Lack of firm data on the road network in Tanzania has a negative implication for the management of the network in terms of planning road works and ensuring effective budgeting. 8.15 The Condition of most district roads, feeder and urban roads in Tanzania is very poor with very few of them providing year-round access. Estimates show that about 60% of the district and feeder road networks are impassable to motor vehicles throughout the year due to missing bridges and culverts, and short interspersed stretches of native bad soils along a big portion of the district roads. It is estimated that 90% of the district roads and feeder roads are not accessible by motor vehicles during the rain season. The major task facing the district roads is rehabilitation due to damages caused by the EL-NINO rains. 8.16 The budget for district and rural roads is met by a combination of subventions form the central government through MRALG and councils own revenues. While resources from the central government are used for development purposes, resources from the district and urban councils are used for maintenance purposes. Disbursement for development purpose has been minimal and even the greater part of the maintenance expenditure is met by the Road Fund. Table 8.4 shows the distribution of the Road Fund 104 for trunk and regional roads (Ministry of Works), and for district and rural roads (Prime Minister's Office and Ministry of Regional Administration and Local Government). Table 8.4: Road Fund collection and allocation to MOW and PMO/MRALG (in mill. Tsh.) Year Total Collection of Allocations to Road Fund (1) MOW (2) PMO/MRALG (3) 3/1 (%) 1991/92 3741.9 2464.3 616.1 16% 1992/93 6840.8 5337.3 1334.3 20% FY94 14272.2 8515.4 2317.0 17% FY95 21198.5 16265.6 3796.9 18% FY96 28307.5 16000.0 4000.0 14% FY97 25398.8 15998.4 3450.0 14% FY98 33745.3 14999.8 2600.0 8% FY99 38365.5 29818.7 12779.3 33% FY00 22275.4* .. 4252.0** .. Note: * Collection from July 1999 to January 2000, ** Allocation up to February 2000. Figures beginning from FY99 are allocations to MRALG. Source: MOW, PMO and MRALG 8.17 It is clear from Table 8.4 that the allocations of the Road Fund have remained less than 20% over the past five years except for the FY99 when they were about 33%. It can also be noted that before FY99 not the total amount of Road Fund collected in each year was disbursed to MOW and PMO. Some funds from this source were diverted to other uses. The situation improved only recently in FY99 when the Road Fund Board was formed to oversee the collection and distribution of the Road Fund. 8.9 DONOR COMMUNITY RESOURCES FOR ROADS 8.18 Table 8.5 shows the donor commitment for trunk and regional roads in terms of the amount budgeted and the actual amount disbursed. It is worth to note here that there are some district roads that receive donor funding although not reflected in Table 8.5. Table 8.5: Flow of resource form donors (in mil. Tsh.) Type FY98 FY99 FY00 Budget Actual % Budget Budget Actual % Budget Budget Trunk Roads 1740 1324 76% 3450 2733 79% 4000 Regional Roads 39895 2807 7% 47698 16382 34% 27758 Total Donor 41635 4131 10% 51148 19115 37% 31758 Source: Ministry of Works 8.19 Table 8.5 indicates that actual amounts disbursed were far less than the budgeted amounts for FY98 and FY99. The deviations between the budgeted amounts and actual disbursements for regional roads ranged from 93% to -66%, while for trunk roads they ranged from -24% to -21% for FY98 and FY99, respectively. Much of the deviations can be explained by delays in the release of funds due to delays in finalizing of the 105 institutional changes for the management of the road sector. These institutional changes were related to: * Establishment of a dedicated road fund for the maintenance of the road network; * Establishment of the roads board for the management of the road fund and to regulate the use, maintenance and development of the road network; and * Establishment of the road agency that will be responsible for the maintenance and development of the trunk road and regional road network. 8.20 The big variation between committed and disbursed amounts has widely been shown by the EU and the World Bank. This variation reflects basically the inability of the MOW to access the funds from the donor community. Some of the reasons that have contributed to this situation are: failure to provide down payment of full amount of the counterpart funds by the Government; delays in the institutional reforms mentioned above; delays in procurements which have resulted in cost overruns; and delays in the disbursement of the road fund which leads to a low absorption of the funds because of time constraint and seasonal rains that are not conducive for road maintenance, especially for gravel and earth roads. 8.10 RECOMMENDATIONS 8.21 Detailed assessment of the impact of the past road maintenance operations, with particular emphasis on whether the expenditures have created the desired benefits, is important. It would appear that the unpaved road network is deteriorating despite increased maintenance funding, and the effects of very spread and limited maintenance may in fact be negligible and possibly wasted. 8.22 Detailed annual road condition and traffic surveys to monitor impact of road maintenance operations, and create basis for selecting and prioritizing a strategic road networks that must receive full maintenance, is crucial. Condition surveys must include some forms of scientific evidence to support visual inspections and limit impact of subjective opinions and possible other motives to show a road in good condition. Detailed annual road condition surveys with some degree of scientific evidence are required to effectively monitor the development, and in particular to identify expenditures that do not produce the expected results or benefits. Normally, annual road surveys should be undertaken by an outside evaluator in order to firmly establish money used for road maintenance is well spent. 8.23 In order to fund the road sector as required two approaches are suggested: either to increase Road Fund revenues or to scale down the level of ambition for the road network and maintenance policy. It has, however, been shown that the road fund is capable of generating surplus recurrent funding to bridge the financing gap for development expenditure in the next two fiscal years where the bulk of the investment is required. This would require a temporal relaxation of the road fund statute depicting that only 10% may be used for development activities. However, where it is not easy to raise road fund revenues, the second option should be taken. 106 8.24 Dedication of the Road Fund to the maintenance and development of a strategic road network, as opposed to the present split between MOW and MRALG. These funds should be released on time and sufficiently in order to implement planned projects and programs on road network. 8.25 There is a need for a detailed assessment of the status of implementation of development projects with donor commitments, including verification of need for GoT counterpart funding (also for projects with 100% donor funding where compensation and possibly relocation of utilities is still required); and preparation of realistic time schedule for individual project implementation. The objective here is to ensure the availability counterpart funding, possibly by postponing some projects until they become affordable or by increasing the development expenditure from the national budget. 107 9. AGRICULTURE 9.1 OBJECTIVES OF THE FY01 AGRICULTURAL SECTOR PER. 9.1 The overall objective of the FY01 agricultural sector PER was to provide inputs into the preparation of the budget guidelines, the budget for FY01 and sector MTEF for FY01-FY03. This PER also devoted particular attention to the relationship between budget allocations and the poverty alleviation as well as food security. Specific tasks included: (i) review of recent performance of the sector, (ii) assessment of the available resources and major constraints (iii) analysis of the sector plan and budget for FY01 and (iv) recommending options. 9.2 PERFORMANCE OF THE AGRICULTURAL SECTOR 9.2 Generally, agricultural performance for the past three years was positive, despite the existence of various impediments. Agricultural GDP grew at a rate of 2.2% (Table 9.1) in 1997 but declined to 1.9% in 1998 because of adverse whether conditions (BOT, 1999) and also due to some imperfections in the operations of the liberalized crop markets. Table 9.1: Agriculture GDP and Growth Rates (in constant 1992 prices) Agricultural GDP Growth rates Sub sector (Tsh. Bill) (% per year) 1996 1997 1998 1985-90 1990-95 1995-98 1997 1998 Main food Crops 323.1 269.9 350.3 4.3 3.0 3.5 -16.5 29.7 Other Food Crops 136.5 140.3 144.2 3.0 2.8 2.9 2.7 2.8 Export Crops 67.2 64.2 77.4 1.8 7.7 5.4 2.7 1.9 Live Stock 94.3 96.8 98.7 3.0 2.5 2.7 -4.5 2.6 Forestry/Hunting 45.6 46.8 47.4 2.7 2.6 2.6 2.7 1.2 Fishing 41.2 42.8 44.3 3.0 3.7 3.4 3.7 3.5 Agricultural GDP 709.0 662.8 764.3 3.5 3.3 1 3.3 2.4 1.9 Source: MAC: Food Crops 9.3 Production of cereals and non-cereals increased from 3111 and 2775 thousand metric tons in FY97 to 4271 and 3750 thousand metric tons in FY99, equivalent to an increase of 37% and 33% respectively. Total food production increased by 35%. Performance of most food crops during FY99, was poor, mainly due to poor rainfall, which was accompanied by long periods of dry spells. Food production dropped by 7% from 7971 to 7440 thousand metric tons with paddy and wheat registering the bigger falls in production. 9.4 Production of food crops in the country during the 1997-1999 period was generally affected by unfavorable whether conditions: rains were either too little, too much, late and /or rained for only a short period. The production of cereals was forecasted to increase by 5% during FY00, as opposed to a fall in non-cereal crops of 3%. However, overall total food production was expected to increase by 1%. 9.5 Food insecurity continued to be a major problem and recurring phenomenon in different parts of the country. Physical and economic access to sufficient, safe and 108 nutritious food to meet dietary needs and food preferences for an active health life remained outside the reach of the majority of the people. Although food production has been marginally increasing over the past three years, and in some years exceeding the overall food requirements, the nutritional energy requirements were far from being met on a sustainable basis. During the normal agricultural production years, some parts of the country were able to produce sufficient food crops while others registered short falls. 9.6 Over-dependence on rain-fed agriculture, adverse climatic conditions labor shortage in rural areas due to rural-urban migration among the youths and increasing incidence of HIV/AIDS infection, were among the frequently cited factors that contributed immensely to food insecurity in Tanzania. Other factors included lack of subsidies for agro-inputs, lack of credit, frequent institutional changes and at the policy level - the relative emphasis on social sectors compared to economic sectors. Cash Crops 9.7 Output performance of all cash crops was negative except for coffee, sugar and cashew-nuts. Cashew-nut production grew by 39% in FY98 from 67500 metric tons the previous season and by 13% to 105000 metric tons in FY99. The growth in production of coffee and sugar increased from negative 12% and 27% to 13% and 31% respectively. The crops whose production fell persistently are cotton and sisal. Cotton production fell from 66661 metric tons in FY98 to 24169 metric tons in FY99 (about 64% compared to 27% in the year earlier). During the same period, sisal production fell by 19 and 25 percent respectively. Similarly, growth in production of tea and tobacco declined from 33% and 44% registered in FY98 to - 16% and -13% in FY99 respectively. Table 9.2: Cash Crops Production (in metric tons) Year/Crop Coffee Cotton* Sisal Tea Cashew- Tobacco Pyrethrum Sugar nut FY97 42000 90697 22000 19767 67000 35379 600 116300 FY98 37000 66661 20000 26206 93173 51014 400 85000 FY99 41900 24169 15000 22000 105000 44264 500 111040 FYO0** 50000 54300 20000 26000 110000 56000 1000 120000 % change -12.0 -26.5 -9.0 33.0 39.0 44.0 -33.0 -27.0 FY97-FY98 I I % change 13.0 -63.7 -25.0 -16.0 13.0 -13.0 25.0 31.0 FY98-FY99 * I bale lint cotton 181kgs ** Estimates Source: MAC, Budget Speech, FY00. 9.8 The observed decline in coffee production was mainly on account of bad weather coupled with low use of inputs while the decline in production of cotton was caused by failure of co-operatives to pay farmers promptly, bad weather conditions and increasing input prices. By contrast, the impressive performance in the production of cashew-nuts and tobacco was due to good weather condition, availability of inputs and liberalization of marketing. 9.9 Foreign exchange earnings from exports of coffee, cotton and sisal declined over the period 1996-1998 while that from cashew-nuts, tea and tobacco increased. The top earners of foreign exchange earnings remained to be coffee, cotton and the strongly coming up cashew-nuts. 109 Livestock 9.10 The general performance of the meat sub-sector during the FY99 period was satisfactory relative to local demand. About 268700 tons of meat were produced in FY 99 compared to 260000 tons in FY98. The target of meat production for FY00 was 300000 tons. Milk production increased from both traditional (rural) and commercial sector. During FY98 about 670 liters of milk were produced compared to 600 liters of milk produced in FY97. Production of day-old chicks was below the national requirement of 10 million by 2 million due to poor quality of feed, frequent disease outbreak and rapid rise of feed prices. The capacity of animal feed industry stood at 381000 metric tons while actual production was 280000 metric tons in FY97. Overall, the livestock sector contributed about 13% of GDP. Co-operatives 9.11 The number of co-operatives increased from 4515 in FY96 to 4538 in FY98. Despite the increase in number of registered co-operatives, only 3.7% of all registered co- operatives' accounts were audited compared to 25% in FY96. Activities undertaken by the co-operatives directorate in MAC, including inspection and supervision of primary societies and co-operatives, establishment of Inspection Fund, and establishment Credit Co-operative Societies (SACCOS), were scaled-up during FY98. 9.12 MAC in collaboration with the Bank of Tanzania (BOT) continued with the process of designing strategies to establish financial institutions to support the co- operatives sector including the establishment of additional SACCOS to cover most parts of the country. This is in addition to the supervision of banks owned by co-operatives. The co-operatives that have their own banks include Kilimanjaro Native Co-operative Union (KNCU) (Kilimanjaro Co-operative Bank started in 1996), VUASU, and Nyanza Co-operative Union (NCU). The objective has been to address the problems faced by primary societies including fierce competition from private crop buyers and lack of sufficient financial resources. 9.3 BUDGET PERFORMANCE FY98-FYOO 9.13 A declining Recurrent Budget: Generally, recurrent expenditure for the agriculture sector declined during FY99. However, actual expenditure for some of the sub-votes tended to exceed the approved budget estimates. For instance actual expenditure on Food Security exceeded approved expenditure by 347.2%. This over expenditure on food security is broadly ascribed to food deficits occasioned by the El Nino rains of 1997 and early 1998. However, it is also clear that the largest share of the expenditure went to finance crop development, co-operative development and administration. 110 Table 9.3: Recurrent Budget for FY98-FYOO (Mil. Tsh) Sub votelProgram FY98 FY99 FYOO** Actual % of Actual % of Actual Expenditure Budget Expenditure Budget Expenditure 101 Administration & General 2302.1 112.0 2253.6 162.0 457.3 102 Finance and Accounts 38.9 58.6 71.3 89.0 2.7 103 Policy and Planning 79.4 52.8 91.4 55.0 49.3 104 Agric. Training Institute - - 255.1 34.0 0.3 201 Crop Development 5936.0 161.3 3634.2 69.0 836.5 301 Research and Development 1588.6 79.4 1617.8 91.4 82.6 401 Co-op. & Inst. Development 1440.6 109.8 1874.0 115.5 842.5 501 National Food Security 1040.4 92.1 6138.8 547.2 0.0 601 Livestock Development 16.5 0.6 2369.7 75.0 0.02 TOTAL 10142.8 95.6 18306.0 119.5 2271.1 Note ** Actual Expenditure for July-December Sources MAC, Appropriations Accounts and Appendix 3.1 9.14 Both the Co-operative and Crop Development Departments spent the lion's share of the entire budget of the ministry (Table 9.3). By contrast the Agricultural Training Institute and Livestock Development Department suffered from inadequate resources, whereas food security received no funds at all. 9.4 CONSTRAINTS AND FUTURE PROSPECTS OF THE AGRICULTURE SECTOR 9.15 Due to numerous constraints agricultural production and productivity has remained rather low and consequently the country is still a net food importer and recipient of food aid. Several cross-cutting impediments to accelerated agricultural development, which are detailed in the recent Agricultural Memorandum (World Bank, 2000) include: inadequate budgetary allocations; poor state of rural infrastructure; inadequate rural financing; poor technology development and transfer; multiple levies, fees, and taxes; seasonal labor shortage; uncertainties about land ownership and use; issues concerning water availability for irrigation and livestock use; and low private sector participation in agricultural production. 9.16 Constraints on food crops sub-sector include: unfair food trade practices; arbitrary crop movement bans; impact of food imports on domestic prices; and unprofitable input use. The critical constraints currently facing the co-operative sub-sector include: lack of capital/credit facilities; employees without relevant skills/qualifications; and financial mismanagement. These weaknesses facilitate existence of rampant thefts and frauds. Most people still view co-operatives as government institutions with weak control and no follow-up. 9.17 Prospects for the future growth of the sector depend on the intensification of production. Most of the growth in per capita output in agriculture will have to come from more intensive use of existing resources. But this can not be possible if farmers continue to depend on rainfall and weather conditions. Although the liberalization process has laid the foundation for the private sector to increasingly participate in agricultural development activities, further success will hinge on the ability of macro policies to adequately address inadequacies related to the five 'ins' namely: incentives, institutions, infrastructure information and inputs. This will enhance productivity and competitiveness in the sector and will contribute towards the transformation of farming 111 practices. Successful intensification of agriculture will therefore depend on completing the reform agenda and sustaining a sound policy framework on both the macro and sectoral levels; reversing the present low level of productivity; building the rural asset base and inter-linkages. The components of this framework will entail making higher investment in infrastructure particularly rural roads, research and extension; building and/or maintaining efficient institutions; using livestock resources efficiently; efficient service delivery; dealing with decentralization issues in a pragmatic manner; conserving the environment; and developing human resources. These will need to be accompanied by the creation of an appropriate legal framework. 9.5 RESOURCES AVAILABLE TO THE AGRICULTURAL SECTOR Physical Resources 9.18 Tanzania is endowed with a vast land resource suitable for crop production. Of the total 43 million hectares suitable for crop production in Tanzania, only 6.3 million hectares are cultivated (MAC's Agricultural and Livestock Policy FY97). With an estimated population of 32 million, land availability in Tanzania is not a constraining factor in the short run. Though there are some areas in Tanzania where population density is high, such population is not limited by existing regional boundaries considering that they are free to move to areas where population density is still much lower. However, there is need to device appropriate policies, strategies and incentives for the implementations of incentives aimed at ensuring proper usage of land and water resources. Human Resources in MAC 9.19 The MAC has well-educated personnel with the appropriate capacity to run and implement agricultural policies and plans. Most of the educated personnel are found in research and training departments/institutes. For instance, there are over 350 MAC employees who are highly trained research scientists (60% have MScs and Ph.Ds). Other employees are graduates of Agricultural Institutes in the country with the majority holding diplomas and certificates. These are mostly livestock and agriculture field auxiliaries and other supporting staff. Financial Resources for MAC 9.20 Based on the budget frame for FYOO-FYO2, MAC expected to spend a total of Ths. 4.2 billion on extension services with support from IDA, AfDB and the Government of Netherlands. MAC also expected to spend about Tsh. 4.7 billion on research and development in the medium-term. The World Bank committed USD 21.8 million for a five-year period running up to year 2003 while other donors pledged a total of USD 23.1 million during the same period. A total Tsh. 2.1 billion was expected to be used on regulatory services, particularly giving priority to the control of epidemics and infectious diseases, sanitary control, quality control and standards, and inspection of pests and diseases. This was to be co-financed by the MAC and the German Government. However, German assistance declined considerably (from 1.5% in FY98 to 0.02% in 112 FY00) hence calling for the GoT increase resources on regulatory services. The World Bank has been the major financier of the Agricultural Information and Statistics (AIS) activities and the outlook seems to have been very promising. World Bank Funding on AIS increased from 25.7% in FY 98 to 35% in FY00. MAC also expected to spend Tsh. 1.2 billion to promote and strengthen co-operatives in the medium-term. Potential Sources of Financing for MAC 9.21 Local Sources: The potential areas for generating local funds for the MAC include, foundation seed farms, seed quality control, livestock movement permits, secondary markets and holding grounds, meat inspection and primary markets, pasture seed and hay production, permits for livestock and hides export, training institutes, and research centers. If all these revenue sources were fully operational, MAC estimates that as much as Tsh. 1.8 billion can be collected annually. 9.22 Foreign Sources: Under the Multilateral Debt Fund and the HIPC Initiatives the MAC, like other ministries, is faced with a challenge to come up with concrete proposals to utilize these debt relief funds for the sectors development. Thus, this is one important area for acquisition of foreign resources which MAC has to capitalize on. 9.6 PRIORITY AREAS FOR UTILIZING MEAGER RESOURCES 9.23 The major objectives of the Government with respect to the agriculture sector are to (i) ensure basic food security for the nation and improve the standard of nutrition and living conditions in rural areas (ii) provide support services to the agriculture sector which cannot be provided efficiently by the emerging private sector, and (iii) increase foreign exchange earning through promoting increased exportation of agricultural produce and output of agro-based industries. 9.24 Achieving these objectives will entail giving priority to strengthening policy formulation, rehabilitation of research, extension and training facilities, and enhancing institutional reforms and capacity building in MAC. It will also require continued funding of support services that promote and facilitate environmentally sustainable economic growth and sustainable development in the rural areas, higher income for the rural people, growth in agricultural exports, and environmentally and sustainable use of land resources. 9.7 POLICY RECOMMENDATIONS * The Government needs to facilitate and encourage private sector involvement in agribusiness and agricultural services coupled with a renewed emphasis on use of improved agricultural technologies, improved farming techniques and promotion of rural financial services. * The Government through the Co-operatives Department in the MAC should take the lead to promote and strengthen the co-operative sub-sector through (i) the provision of training to workers, members, and the public at large especially on credit management, delivery and recovery systems, and (ii) the promotion and establishment of SACCOS. 113 * The Government needs to design strategies and mechanisms, which will enable Tanzania to disengage gradually from donor dependency as far as funding of economic development in general, and of agricultural sector specifically is concerned. This is necessary to avoid leading the country into a vicious dependency trap. * The effective implementation of budget requires the government and donors to collaborate in ensuring that a sector-wide approach to planning and aid co- ordination is adopted. Coordinated donor support to coherent sector programs that address both recurrent expenditure and investment requirements of each sector in line with the Tanzania Assistance Strategy (TAS) and the Highly Indebted Poor Countries (HIPC) initiatives will be absolutely essential. 114  10. JUSTICE 10.1 INTRODUCTION 10.1 The Ministry of Justice and Constitutional Affairs (MJCA) is composed of three independent departments, namely, the Attorney General's Chambers, Judiciary and the Law Reform Commission of Tanzania. The Attorney General's Chambers is headed by the Deputy Attorney General and the Permanent Secretary, while the Registrar of the Court of Appeal and two Executive Secretaries head the Judiciary and the Law Reform Commission of Tanzania, respectively. 10.2 The Justice and Judiciary departments are independent in accordance to observance and upholding of the doctrine of Separation of Powers, and institution of the principle of Checks andBalances. The Judiciary is supposed to perform its duties independently, without interference from the Executive and Legislative branches of government; and to be able to check the powers of the other two branches of the government. 10.2 VISION 10.3 The vision of the MJCA is a component part of the Tanzania's Development Vision 2025 which among other things, aspires to develop a society that has the following attributes: Peace, political stability, national unity, and social cohesion; Democracy as well as political and social tolerance; Good governance, rule of law, integrity and moral uprightness; The highest level of ingenuity, self confidence and self esteem; Peace centered development; Economic and social justice; Equal opportunity to all citizens to participate in contribute to the development of the nation , paying attention to minority and disadvantaged groups in society; A strong, diversified, resilient and competitive economy which can effectively cope with the challenges of the development goal and confidently adapt to changing market and technological conditions in the increasing liberalized and globalized world economy; and sustainable development endeavor. 10.4 The Ministry's Vision which upholds, and is also commensurate with the attributes of the Vision 2025 aspires to have a society in which there is: speedy dispensation of justice; affordability and access to access justice for all social groups; integrity and professionalism of legal officers; enhanced independence of the Judiciary; and a legal and regulatory framework, and jurisprudence of high standards, which are responsive to social, political and technological trends at both national and international level. 10.3 MAJOR ISSUES 10.5 The main issues which need to be addressed currently include: (i) Updating and harmonizing the legal and regulatory framework; (ii) Enhancing the independence of the judiciary and integrity of legal officers; (iii) Strengthening the management and co-ordination of legal sector institutions; 115 (iv) Enhancing the competence and motivation of the personnel in public legal institutions (v) Improving pre-service training and constantly upgrading legal skills of law officers in the public service to enable them cope up with new challenges in the market economy and new liberal constitution regime; (vi) Enhancing access to legal services for the poor and disadvantaged; (vii) Developing and maintaining an enabling and conducive work environment for the public legal officers. 10.6 In addition to addressing these problems, reforms in the legal sector must also aim at making the legal sector responsive to social, political, economic technological transformation. The challenges currently facing the legal sector include: (i) The changing social culture of the people due to urbanization and the expanding and intensifying interaction with other cultures, which requires a more dynamic family law. (ii) The new pluralistic democratic political environment coupled with the movement towards participatory management of socio-economic development (iii) The expanding institutionally complex private sector led market economy. The legal framework needs to change to facilitate regulation of corporate behavior, to protect consumer interests, and timely resolution of civil and commercial disputes, and (iv) The rapidly growing electronic commerce creates many business transactions not requiring the use of ordinary paperwork. Thus the nature of evidence admissible in court must be redefined. 10.4 GoVERNMENT EXPENDITURE ON MJCA 10.7 The public legal sector, in this case the three departments of the MJCA, has for a longtime been accorded a very low priority in the allocation of budgetary resources. Table 10.1 shows approved and actual expenditure for FY98 and FY99. Table 10.1: Actual Government Expenditure on MJCA, FY98 and FY99 (Million Tsh. and Percentages) Item FY98 FY99 Approved Actual Approved Actual Recurrent Expenditure 458190.8 428384.4 550923.8 547388.7 Ministries 339,912.0 311,065.2 430,019.3 418,416.0 Regions 118,278.8 117,319.2 120,904.5 128,972.7 Development Expenditure 300,548.6 82,894.7 187,277.8 90,159.0 Total Government Expenditure 758739.4 511279.1 511279.1 637547.7 MJCA development Expenditure 331.9 24.4 248.9 4.9 MJCA Recurrent Expenditure 5540.9 5507.7 7592.6 7374 Total MJCA Expenditure 5872.8 5532.1 7841.5 7378.9 MJCA Share in Total Recurrent 1.21 1.3 1.4 1.3 Expenditure MJCA Share in Total Development 0.11 0.05 0.13 0.01 Expenditure MJCA share of Total Government 0.77 1.08 1.5 1.2 Expenditure Note: Data from MJCA indicate that the ministry's recurrent expenditure for FY99 was only 7306.5. Source: Ministry of Finance Files 116 10.8 According to Table 10.1 the share of the legal sector in the total government actual expenditure increased only marginally from 1.08% in FY/98 to 1.2% in FY99. The increase was partly for meeting the cost of white paper exercise and paying debts. The share of the sector in government actual recurrent expenditure remained more or less constant at 1.3%, while that of development expenditure dropped drastically from 0.05 in FY98 to 0.01 in FY99. A large part of it came from donors. Low allocations for development expenditure in the MJCA can be accounted for by the fact that it was not among the priority sectors prior to FY00. The implication of this is the increased potential of doing away with marginalization of the MJCA in terms of budget allocation, and hence, the possibility of improving the quantity and quality of the services provided by the public legal sector. 10.5 ALLOCATIONS WITHIN THE MJCA 10.9 The small budget in the MJCA is allocated and spent independently in the three departments based on their different functions. 10.10 Table 3.30 shows that within the ministry, the budget expenditure is distributed into the three independent departments. The judiciary department received over 70% of the budgeted allocations during FY98 and FY99. Over the same period the AGC department received less than 30% while the Law Reform Commission received less than 2% of the budgeted resources for MJCA. Most of the expenditure in the departments were directed into recurrent expenditure with only the AGC department having some small development expenditure. The other two departments had no development expenditure during the two fiscal years. Table 10.2: Distribution of MJCA Expenditure by Departments (million Tshs) Department FY98 FY99 FYOO* Total MJCA Expenditure Justice Department's Total Expenditure 914.4 1934.7 528.7 Recurrent Expenditure 890.0 1929.3 Development Expenditure 24.4 4.92 Department's share of MJCA Expenditure 16.5% 26.4% Law Reform Commission Total Expenditure 102.4 86.5 44.5 Recurrent Expenditure 102.4 86.5 Development Expenditure 0.00 0.00 Department's share of MJCA Expenditure 1.9% 1.2% Judiciary Department's Total Expenditure 4515.3 5290.7 2244.2 Recurrent Expenditure 4515.3 5290.7 Development Expenditure 0.00 0.00 Department's share of MJCA Expenditure 81.6% 72.4% Source: Budget Estimates Documents for the respective years. Actual expenditures for the period between July 1999 and January. 10.6 ACTUAL RECURRENT EXPENDITURE BY DEPARTMENTS AND ZONES 10.11 This section analyses recurrent expenditure of the various sub-departments and zones in each of the three departments of the MJCA. The analysis is made so as to reveal the areas in which recurrent expenditure was actually made and in reference to the roles which the legal sector is expected to play in the country particularly during reforms. 117 Table 10.3: Actual Recurrent Expenditure in the Judiciary Department in terms of PE and OC (in percentage) Sub-Department/Zonal FY98 FY99 Budget FY00 PE% OC% PE% OC% PE% OC% 1. Administration and 29.8 70.2 28.8 71.2 14.1 85.9 General Expenditure 2. High Court 73.2 26.8 19.5 80.5 7.1 92.9 3. Court of Appeal 32.5 67.5 11.6 88.4 15.3 84.7 4. District Courts 0.0 0.0 0.0 100.0 60.4 39.6 5. Primary Courts 100.0 0.0 75.1 24.9 56.5 43.5 6. Arusha Zone 86.3 13.7 67.9 32.1 7. Dar es Salaam Zone 91.2 8.8 78.5 21.5 76.3 23.7 8. Dodoma Zone 83.3 16.7 67.0 33.0 66.2 33.8 9. Mbeya Zone 89.6 10.4 79.5 20.5 71.4 28.6 10. Mtwara Zone 82.6 17.4 83.6 16.4 74.5 25.5 11. Mwanza Zone 86.1 13.9 78.7 21.3 78.0 22.0 12. Tabora Zone 88.5 11.5 130.5 -30.5 67.0 33.0 13. Tanga Zone 84.6 15.4 66.2 33.8 67.5 32.5 14. Bukoba Zone 80.5 19.5 75.5 24.5 62.4 37.6 15. Songea Zone 85.4 14.6 76.7 23.3 68.1 31.9 16. Moshi Zone 85.6 14.4 73.6 26.4 77.2 22.8 7. Total Recurrent Exp. 62.9 37.1 53.7 46.3 51.8 48.2 Note: PE= Personal Emolument OC= Other Charges * = Budget estimates Source: MJCA's Budget Estimates for respective Department 10.12 The Judiciary Department's expenditure is distributed into various sub-departments and zones as shown in Table 10.3 In general the proportion of personal emoluments (PE) expenditure dominates (over 70% on average) in all cases except in the Administration and General Department, District Courts and the Court of Appeal. Otherwise the rest of the departments and zones have relatively smaller proportions of other charges (OC) expenditure. The effects of such small OC expenditure is to have staff being paid salaries but with no equipment and facilities to enable them perform their duties efficiently. A large number of pending cases and the general decline in the quality of services provided by the judiciary department is partly due to this problem. 10.13 Overall, in FY98 and FY99 the department's actual recurrent expenditure was concentrated in the Administration and General expenditure (over 44%), followed by Primary courts (about 15%). However, looking, for instance, at the department's FY99 approved budget (i.e. government commitment) it is shown that most (over 40%) of the departments recurrent funds would have gone to Primary Courts followed by the Administration and General expenditure (about 17%). The above noted actual expenditures, therefore, was a reversal of what would appear to have been put as a priority i.e. funding the primary courts activities and in the process administering justice to the rural people. In fact, while the current expenditure for the Administration and General Expenditure increased, in FY99, by 286% from the approved expenditure of Tshs 814.6 million to actual expenditure of Tshs. 2,333.3 million; the corresponding figures for the Primary Courts show a remarkable decrease as the actual expenditure of Tshs 805.7 million was only about 44% of the approved budget of Tshs 1848.5 million. 118 Table 10.4: Development Expenditure on MCJA (TShs. Million and %) FY98 _ FY99 FY00 Approved Actual Approved Actual Budget Budget MCJA Development Expenditure of which 331.9 24.4 248.9 4.9 (i) Local (%) 0 0 0 (ii) Foreign 100 100 100 100 Govermments Total Dev. Expenditure 300,548.6 51718 187,277.8 82,894.7 MCJA share of Total Dev. Expenditure 0.11 0.05 0.13 0.01 Expenditure by Departments AG Chamber Total 310.9 24.4 248.9 4.9 Share Of 93.7 100 100 100 MICA Judiciary Total 21.0 Nil. Nil. Nil. Share of 6.3 0 0 0 MICA Law Reform Commission Total Nil Nil Nil Nil Share 0 0 Source: MJCA's Budget Estimates for respective Departments 10.14 In the case of the High Court its actual recurrent expenditure for the FY99 was only 66% of the approved budget. A slight decline in the corresponding shares was observed for the Court of Appeal, as well as Mtwara and Tabora High Court zones. The rest of the High Court zones had substantially higher actual expenditures compared to the approved budgets. Overall, the departments recurrent actual expenditure of Tshs. 5290.7 million for FY99 was higher, 116.4% than the approved expenditure. The increase was actually due to increased election petitions most of which were heard at High court and Court of Appeal. The need to clear such political cases explains partly the increased resource allocations to these courts. However, this appears to have been done at the expense of under funding the primary courts most of which are dealing with settling various disputes and criminal cases for the majority of people. Such a practice tends to defeat the objective of bringing social and economic justice to all people. The budget estimates for FY00 however have addressed this problem by giving more weight to primary courts with a share of 44% of the department's total recurrent expenditure. 10.15 Part of the differences between the actual and approved recurrent expenditure arises from the fact that the government has been injecting funds, in say, the Judiciary for the purposes of paying debts, enabling the court activities to continue and other expenses. These expenditures which do not fall within the original budget estimates are sometimes included in the expenditure as OC and in certain cases they are not included. 10.16 Like most other ministries, the MJCA has been receiving very little or no development funds. Only recently has the MJCA been included in the cluster of priority sectors, which include education, health, water, roads, agriculture and lands. Most of the development funding to the MJCA as shown in Table 3.32 has been coming from the donor community. 119 10.7 RECOMMENDATIONS i) Establish a planning and policy unit in the Ministry and in the three departments. However, this unit should be part of the new directorate of research and library services, which has been approved by the Government. ii) Increase government financing to the legal sector so as to improve remuneration and complementary resources availability, iii) Call for more donor financing in development expenditures, particularly in training, equipment acquisition, construction and rehabilitation of office buildings and strengthening of libraries and record keeping, iv) Adopt disputes solving, mechanisms, so as to reduce burden on the formal courts, v) Respective departments to undertake internal cost-cutting exercises, vi) Allow for recruitment of staff, particularly professional legal staff, vii) Improve the budgetary process by allowing the registrar of the Court of Appeal and the Executive Secretary to the Law Reform Commission of Tanzania participate in the budget discussions in the Inter-ministerial Technical Committee. 120 ANNEX I: PUBLIC EXPENDITURE REVIEW FY00 CONSULTATIVE MEETING: KARIMJEE HALL, DAR ES SALAAM (May 2-3, 2000) RECORD OF PROCEEDINGS Welcoming Note 1. Mr. Peter Ngumbullu, Permanent Secretary (PS), Ministry of Finance began by welcoming all the participants to the PER FY00 consultative meeting. Noted that the broad participation goes a long way to consolidate the partnership approach to development agreed between the Government of Tanzania and her development partners a few years back. The PS recognized the presence of Mr. James Adams, The World Bank Country Director for Tanzania and Uganda and co-chairman of the consultative meeting; and Mr. Gerard G. Johnson - Assistant Director International Monetary Fund (IMF), East African Division who was in the country leading the IMF mission to review the Poverty Reduction and Growth Facility (PRGF) program. The PS also thanked the PER Working Group, now expanded to include almost all stakeholders, for the tremendous progress made under Government leadership to oversee the implementation of the PER process for FY00. 2. Prior to inviting the Guest of honor to formally open the meeting, the PS summarized the work program for PER FY00 to have included the following technical studies and activities: (i) Overall Fiscal Sustainability study (ii) Analysis of the Development Budget: Performance and Issues (iii) Road Fund Tracking study (iv) Poverty Monitoring Indicators study (v) PER - Education, Health, Water, Roads, Agriculture and Judiciary (vi) MTEF Training in 12 Ministries (vii) Mainstreaming Gender in the Government Budget (viii) Joint World Bank - Bilateral Donors PER Mission (ix) Development of the cross-sector MTEF (x) Development of the TAS and PRSP Noted that all the activities in the work program have been implemented successfully Official Opening 121 3. The Deputy Minister for Finance Hon. Abdisalaam Issa Khatib (MP) opened the meeting on behalf of the Minister for Finance Hon. Daniel Yona (MP). The Deputy Minister expressed gratitude to the organizers for inviting the Minister for Finance to open the PER FY00 consultative meeting. 4. Noted that the PER FY00 process consolidated and deepened the new approach focusing mainly on providing direct support to the Government's budgeting process. 5. The Minister was encouraged that the now broadened and participatory PER process has opened up the budget process to stakeholders outside the government (private sector, civil society, and research/academic institutions). 6. Emphasized that the Government values the consultative meeting as it provides a unique forum to all stakeholders to discuss key public expenditure policies and programs. 7. Appreciated the advantages of the MTEF approach in terms of ensuring (i) aggregate fiscal discipline (ii) allocation of resources in accordance with strategic priorities, and (iii) efficient and effective use of resources in budget execution. Consequently, the Minister indicated that the plan of the Government is to extend the MTEF to cover all ministries and regions by fiscal year 2001/02. The Deputy Minister pleaded to donors to adopt the MTEF in making their commitments. 8. Informed the meeting that the Government has added the Judiciary, Lands and HIV/AIDS to the list of priority sectors / areas (i.e. education, health, agriculture, water, roads and energy). Also indicated that the Government also places high priority on actions to uphold good governance particularly on the implementation of the anti- corruption strategy and strengthening public financial management systems. 9. Noted that Tanzania has qualified for the enhanced HIPC debt relief initiative to the tune of US$ 2 billion in net present value terms to be delivered over a period of 10 - 20 years. In addition, Tanzania has also been provided with debt relief by the Paris Club (US$ 390 million). The Minister expressed gratitude to all the development partners for the strong support and also to the people of Tanzania who shouldered the pre-requisite qualifications to the HIPC relief including the austerity of the ESAF program. The Minister reiterated the GoT's commitment to utilizing the resources from the debt relief initiatives to improve the delivery of social services and infrastructure. 10. Also registered the GoT's appreciation to all the partners collaborating on the MDF arrangement, and expressed hope that the MDF and other donor programs will be sustained to enable the Government to make quicker progress in funding the priority sectors. I 1. Informed the meeting that the IFMS is now operational in all ministries, government departments and agencies. This has substantially improved the control of expenditures and preparation of accounts. The Government plans to roll out the IFMS to the local authorities to cover 22 of them in FY01. The minister was encouraged that the 122 health sector basket partners are using IFMS and urged other donors to channel their resources through the IFMS considering that the IFMS ensures transparency and accountability in public financial management. 12. Concluded by emphasizing that the Government accords very high priority to building a strong partnership with all key stakeholders in promoting socio-economic development of Tanzania while ensuring Government ownership and leadership. The Minister lauded the joint visit to Tanzania by 4 Ministers for International Development Cooperation from Netherlands, UK, Norway and Germany in the framework of the UTSTEIN initiative, which focuses on deepening the poverty reduction impact of development assistance and simplifying coordination and implementation through strengthening recipient leadership, improving and rationalizing donor systems and increasing value for money. Vote of Thanks 13. Mr. James W. Adams, Country Director (CD) for Tanzania and Uganda - World Bank, and Co-Chairman of the PER FY00 consultative meeting, thanked the Minister for Finance for a thoughtful opening speech. The CD then made the following major observations: * Compared to five years ago, the PER process has been revolutionized from being exclusive and dominated by the WB and IMF to being an important participatory process involving Government, donors, private sector and civil society. Lauded Government leadership, commitment and broadening up of the process as being a hallmark of the PER and whole budget process. The CD emphasized that the PER process itself needs to be strengthened further together with the MTEF. * The budget process is of central importance in the process of economic advancement. Thus, sustaining the gains that Tanzania has made on the macroeconomic front over the last few years requires that the Government keeps guard on ensuring efficient and effective utilization of available budgetary resources. * Although the MoF has began to reach out the sector ministries to strengthen the budget process through the IFMS and MTEF, there is a lot still to be done to improve financial accountability in the budget management system. In this regard what is required is capacity building to (i) make the MoF much stronger in managing the budget process, and, (ii) address capacity constraints at the local level as decentralization proceeds. * The Government has set up a robust budgetary process by broadening participation in the process. While five years ago the discussion on budget performance and management issues were confined to the Government, World Bank and IMF, it is remarkable that the process has now been opened up to other donors, civil society and Parliament - including members from the opposition 123 parties. The Government has also implemented tough decisions. All these need to be recognized and appreciated during the PER consultations particularly by critics. However, the Government needs to sustain budget discipline. Pl: Macroeconomic Context of the MTEF Presentation * The Acting Permanent Secretary - Planning Commission, reviewed the macroeconomic performance of the Tanzania economy over the past five years (1994 - 1999), drawing out specific emerging issues that have a bearing on the PER process. The review highlighted the following: * Tanzania's economy appears to be stabilizing and hence poised for higher levels of growth in the long-run. From a low GDP growth rate of 1.4 percent in 1994, GDP growth has steadily risen to 4.8 percent in 1999. Growth recovery has mostly been driven by macroeconomic reforms that Tanzania has been implementing in recent years. Though encouraging, the upturn in GDP growth is still low to have significant impact on poverty eradication. Besides consolidating and sustaining macroeconomic reforms, the achievement of higher growth will require (i) improved performance of agriculture (ii) strengthening the environment for private investments in the pacemakers for growth - particularly mining and tourism (iii) further privatization and restructuring of industrial sector. * The anti-inflation stance has paid off. From the peak of 35.5 percent in 1994, inflation declined steadily to 6.3 percent in February 2000, mainly due to tight monetary and fiscal stance pursued during the period. This stance needs to be maintained, coupled with increased production of food so as to reduce inflation further to level consistent with inflation level in Tanzania's major trading partners. * Tanzania has made considerable progress in restoring fiscal discipline and channeling public resources toward defined priority areas. However, the level of revenue mobilization remains low mainly due to an extremely low domestic revenue base. This severely limits the Government's capacity to provide basic services to its people. The reduction in the fiscal deficit (before grants) is almost entirely attributed to reductions in Government expenditures (excluding amortization), since domestic revenues as a proportion of nominal GDP have declined over time. * The introduction of the cash budget system has reinforced discipline in Government expenditure. However, as a result of massive expenditure cuts made in trying to match expenditure to revenue availability, most Government obligations, apart from the wage bill and debt service have had to be cut substantially. In the process, service delivery in all sectors has been affected, 124 although priority activities with priority social sectors (education, health, water, roads and agriculture) have now been protected. * The Government intends to continue to undertake prudent fiscal measures to ensure macroeconomic stability. More stabilization efforts will focus on enhancing revenue collections through expanding the tax base and rationalization of the tax system. Stringent budgetary measures will continue to be exercised in order to ensure that expenditures match available resources. The integrated financial management system will be strengthened to enhance efficiency, effectiveness and transparency in expenditure management. * The growth of the extended broad money (M3) declined from 37.7 percent in FY95 to 11.0 percent in FY99, and may decline to 9.2 percent by end-June 2000. The rapid decline in money supply growth, led to a rapid decline in the rate of inflation, which in turn contributed positively towards stability of the exchange rate. * The performance of credit growth, particularly credit to the productive sectors, has not been impressive after liberalization. Commercial banks have shown increasing aversion to lending, preferring to hold risk free assets such as Treasury Bills, partly because of high risks in lending, difficulties on the part of commercial banks to assess the credit worthiness of private borrowers and problems associated with the handling of commercial disputes. The establishment of a Credit Information Bureau to provide information on credit worthiness of prospective borrowers and the establishment of a Commercial Court to speed up the settlement of commercial disputes, are expected to improve the situation. * The spread between lending and deposit rates continues to be unduly high. Both the concentration of new banks in major urban centres and the restructuring of the National Bank of Commerce, including the closure of its remote branches, has deprived rural areas of financial services. This requires a deliberate strategy for assisting the rural sector through the provision of micro-finance services. The recently finalised Rural and Micro-finance policy and a revision of the Banking and Financial Institutions Act later this year to provide for a legal framework for regulation and supervision of micro-finance institutions, are some of the strategies. * The bulk of Tanzania's export sector remains traditional agricultural commodities, accounting for about two thirds of the total export value. Consequently, a large portion of the export bundle remains vulnerable to vagaries of weather and adverse movements in the world commodity prices, and hence leading to a weak balance of payments position. Liberalization of mineral trade, pursuit of macroeconomic stability and removal of foreign exchange restrictions are expected to generated more foreign exchange from mineral exports and tourism. 125 * Core functions of the Government have been redefined to include maintenance of law and order, provision of basic social and economic infrastructure, and creation of an enabling environment for the private sector and other economic agents to invest in productive economic activities. The Government now focuses on policy formulation and economic management, investing in core functions and providing legal and regulatory frameworks. Several institutional changes with a bearing on private sector development have also been made. * The Vision 2025 will be implemented in phases of three years starting from FY02. Preparation of programs and projects will be undertaken during FY01. Other processes, i.e. PRSP, TAS and PER will be instruments of implementing the Vision, which provides the umbrella framework for guiding development policy formulation, prioritization of development programs and projects and setting development goals and targets in the medium term. P2: Fiscal Policy and the Macroeconomic Context Presentation * A consultant for the PER Working Group from Oxford University, Mr. David Bevan, summarized the Tanzania FY00 fiscal policy issues and the macroeconomic context. Specific issues addressed included, a review of links between public and private activities from a perspective reflecting current conditions in Tanzania, the resources available to government, Guidelines for the Preparation of the MTEF, the domestic credit position, and options for the government's fiscal stance. The review highlighted the following: * Over the last several years, the Government of Tanzania has run a tight fiscal policy through the instrument of a cash budget, with a domestic budget surplus. The consequence has been a fairly rapid but orderly process of disinflation, with the annual rate of inflation coming down to around 7% by the end of 1999. While it is essential to consolidate this achievement so that there is no return to the double-digit inflation of earlier years, it is nonetheless no more than a precursor to the real agenda of growth and poverty reduction. Growth is important not only in its own right but as a mechanism for reducing poverty both directly and indirectly via the enhanced social spending it permits. The sources of this growth will inevitably lie in private enterprise, with the government attempting to minimize factors that may inhibit this and promote those that encourage it. The latter factors include not only the regulatory and market environment, but also macroeconomic policies bearing on investment, saving, liquidity and credit. * Tanzania is currently in transition between the economy suffering from excessive fiscal deficits, rapid monetary growth, high inflation, and a lack of private credit in which the imperative is to reduce the deficit so as to permit other problems to be addressed; and the economy in which there has been an extended history of steady growth in a stable policy environment, where the imperative is to maintain the policy 126 regime. The crucial short run choice in terms of policy design for the economy in this interim outcome is over the volume of resources that the government can devote to its spending programs without crowding out the recovery of private activity, while at the same time addressing the question related to the amount of resources that the private sector can actually put into use. * There is nothing to ensure that the banking system will remain fully lent if the government reduces its borrowing. If private borrowers are deemed not to be creditworthy, the system simply becomes more liquid and the loan-deposit ratio falls. This has evidently happened in Tanzania, though it is difficult to be precise about the degree, since the fall in loans also reflected the cleaning out of non-performing parastatal loans. * Much of the credit advanced to the private sector in Tanzania is for trade rather than for investment. Investment tends to be financed from an enterprise's own resources or, in cases where the outputs will generate foreign exchange (such as mining) from external sources. Thus, especially in the short run, withdrawal of government may neither induce increased access to credit by the private sector, and even if it does, this may have a very muted impact on investment activity. * A rapid expansion of private sector credit might be problematic. Since the banking system lacks experience in risk assessment, the alternative to rather limited lending might be a rush of lending leading to an unacceptably high bad-debt ratio. * When a government obtains access to increased resources from external donors and spends some part of this on non-tradable goods, this will tend to induce appreciation of the real exchange rate (the so-called 'Dutch Disease'), unless there are offsetting effects on supply. The Dutch Disease effects are in no way specific to government involvement. Exactly the same issue arises for transfers of external resources to NGOs operating in-country, or to increased private spending if the government passed the aid on to the private sector via tax cuts or increased credit. What matters is that the nation is able to spend more and that part of this spending is on non-tradables. The real exchange rate issue is a feature of accepting the resource inflow, not of any link between this and the level of government spending. * Some forms of spending are likely to have supply side effects. Especially if these come into operation quickly, the real exchange rate consequences of the inflow will be muted and may even be reversed. For example, a program of rehabilitation of roads could remove bottlenecks and lead to an expansion of the production of non- tradables in excess of the increased demand for them. This entails that private and public activities are frequently complementary, so that the private sector may not be best served by a contraction in public sector spending. This is particularly likely to be true in Tanzania, where many forms of government spending are low by the standards of comparable countries. 127 * The MTEF for the next three years shows revenue growing modestly as a share of GDP. The shares are 12.4% for the current year (FY00), and 12.6%, 12.8% and 13.0% for the MTEF period (FY01 - FY03). The present figure is modest by the standards of comparable countries, and the assumed growth of revenues, at 0.2 percent of GDP a year, also does not seem excessively ambitious. However, it has to be noted that this ratio has averaged 12.4% over the last decade, and while it has varied substantially, it has been trend-less. At the same time the authorities are not planning any major tax reforms, but are relying mainly on reduced exemptions and increased administrative efficiency to deliver the revenue gains. * It would be worth developing a more disaggregated method of forecasting revenues, both to obtain more refined inputs into the MTEF and also to permit closer monitoring of performance. This would involve analyzing the compositional shift of growth in various sectors. * There is a strong case for basing the MTEF projections on the most likely scenario, which is that program aid will in fact continue at similar relative levels to the present ones. To take a more conservative view would only be justified either if there were strong grounds for believing that aid cuts were probable, or there were grounds for thinking that regular upward revision of spending ceilings is allocatively less costly than infrequent downward revisions. Budget Guidelines projections are pessimistic, while the HIPC Decision Point document assumes very substantial inflows of new resources in this period. It should be noted that forecasting resources is necessarily risky, but the risk is two-sided, and not minimized by excessive caution. * The logic leading to the selection of the priority sectors themselves seems clear enough. However, it remains obscure what governs the distinction between priority and non-priority activities within these sectors. It is also obscure how prioritization affects the budget allocation process. Allocation to a number of priority sectors as indicated in the Budget Guidelines document lack of any pattern. Sometimes allocations are very far below requirements, sometimes they exceed them. In some cases the ratio for a sector is stable over time, suggesting that the severity of rationing is constant: in others it falls or rises. It does not seem as if the term "requirement" has any stable interpretation, either between sectors, or within a sector over time. This means that the role of the MTEF in matching limited funds to those activities which have the highest pay-offs or are otherwise felt to be most urgent is very inscrutable to the outside observer. There thus seems to be considerable scope to develop this linkage between the prioritization process and the budget allocation more systematically. * The ratio of various money measures to GDP has been falling in Tanzania. A falling ratio is a signal of financial ill health. It may reflect a lack of confidence in the domestic currency, so that agents economize in holding it, possibly by substituting international currency. Alternatively, it may be a response to financial repression, where very unfavorable terms make the formal financial sector an unattractive intermediary. In either case, high transactions costs are imposed on economic activity. 128 When these conditions are reversed by successful policies of stabilization and liberalization, the demand for money is expected to recover, but possibly quite slowly and after a lag as confidence is re-established. * Private credit has indeed expanded rapidly albeit from a very low base. Over the four years from the end of 1996 it has risen in nominal terms at annual rates of 39%, 48% and 26%, or from Tsh 116.6 billion to Tsh 302.2 billion. Since the cumulative inflation over this period was 37%, the growth in real private credit averaged 24% per annum over these three years. A major reduction in the government's use of domestic credit has produced a rapid proportional expansion in private credit, but since the base for this expansion was so small, this private response has still been small relative to the scale of the stimulus. In other words, the Government withdrawal from its previous reliance on domestic credit has had a limited effect of "crowding the private sector back in", since private sector engagement with the financial system, relative to GDP, seems to have been relatively invariant to these changes. Hence the reduction in government engagement has simply led to a contraction in the scale of financial intermediation. The banking system is currently under-lent and over-liquid. * It is desirable for Tanzania to accept as large an external deficit as donors are prepared to finance. For any given choice of domestic deficit, this implies that additional aid should automatically be spent. In turn, the considerations determining what an appropriate level of the domestic deficit might be are not contingent on the level of external finance that is available, rather on the extent to which the government can use additional resources effectively (i.e. the Government has not reached its implementation limit). Then the choice of a value for the deficit depends on what levels of monetary expansion, build-up of foreign exchange reserves, and expansion of credit to the private sector are desired. * There are three possibilities in relation to keeping a contingency allocation in the budget. First, they could remain unspent, in which case the government will be running a domestic budget surplus, not a balance. Second, they could be deployed in face of some genuine unforeseen events, but it is wildly implausible that these would have expenditure implications of this pattern. Third, they could end up being spent but according to the exercise of ministerial muscle rather than the allocation procedures (based on prioritization) embedded in the MTEF. If the intention is to smooth spending in the expectation of uneven revenue flows, that should be signaled, rather than calling the device a contingency. * There is a compelling case that the government should choose to run a modest domestic deficit rather than a balanced budget; to enable it to increase spending on the under-funded recurrent budget and improve service delivery. It is not clear, given the already highly liquid financial system and credit position now, that it would risk crowding out desirable private activity given. The question is rather how much credit the private sector is plausibly going to require, and whether it is likely that it will be able to use the whole increase in domestic credit over the next several years. 129 Discussion/Comments on P1 and P2 * Noted, by an IMF official, that it is true that Tanzania was still in a transitional stage. The country could only run the deficit if foreign reserves can finance it or if enough resources are expected from donors. However, experience has shown that there is a risk of enough inflows not forthcoming. Agreed with the observation that budget surplus has failed to crowd-in private sector credit, but noted that this was mainly because of high lending rates and risk aversion. Bank credit in Tanzania is much lower at 5% of GDP, unlike the Sub-Saharan average of 14% of GDP, indicating that the country still had a long way to go in increasing lending. However, despite all these, IMF thinking was that running deficit was probably not a viable proposition. Concerns/comments by the donor community: * Even though the MTEF projects a reasonably small deficits in three years, there is, however, a big contingency which may translate into large surpluses, at the time when public services are under-funded. Some amount of deficit ought to be allowed, to make increased public funding possible, especially in sectors like roads whose allocation has been disappointingly low. * There is an urgent need to use existing resources to improve existing programs and resource allocation through the budget. Comments and concerns by members ofParliament: * Expressed delight on the way Tanzania was, through the PER process, building a very good base for dialogue - especially on how to chart out ways of reducing poverty and improving welfare of the people. * Expressed concern as to how real are Tanzania's plans given the problem of inconsistency between revenue collection and delivery of visible development. * There is poor translation of macro achievements into real improvement in life (e.g., 4% growth in agriculture reflects growth in which crops when all crops are currently performing poorly?). * Actual expenditure in development budget does not reflect budget as approved by the Parliament. * In order to have accountability there must be good governance in place. However, to have good governance calls for having an opposition from the political front, and other stakeholders in the society; and respecting the rule of law while shunning political patronage and corrupt practices. * There is a need to re-examine the cash budget system. Much as it has succeeded in reducing budget excesses, this has been done at the expense of disregard to the budget as approved by the Parliament. In addition the cash budget has severely reduced service delivery capacity of the Government by making monthly resource availability 130 unpredictable. There is thus a need to set the limit of deviations of allocations through the cash budget vis-a-vis the approved allocations. * Agriculture in Tanzania can do a lot to bring growth and development especially in rural areas. If Tanzania is to cross the international poverty line, then there is a need to revive agriculture, especially through more funding of research and extension services, irrigation, and better use of inputs. An agro-investment master-plan, which is well funded and supervised, is important if agriculture is to grow at the envisaged 8 percent. Also important are improvements in rural roads and credit to the sector; and ensuring that there are organized markets for both cash and food crops. * There is a need to consider the effect of energy tariffs on macro and micro enterprises, with the view to revising them downwards. * There is a need to put in place mechanisms to monitor mineral prospecting and trade/marketing rules if Tanzania is to benefit more from these economic activities. Comments/concerns by the private sector: * Although Tanzania has done major policy changes, there are still lags in putting in place an enabling environment and regulatory framework that conforms to the country's move to a market economy. Lack of regulatory framework makes lending a risky business, thus curtailing the availability of credit to "risky" areas where loan recovery is uncertain. * Privatization of the banking system is almost complete, yet there is no single development bank to cater for long-term investment and other development oriented projects. To promote agriculture, the country also needs an agricultural bank with a focus on rural credit. * The private sector is still very young. It cannot make itself the engine of growth. The government has a role to build capacity in the sector, to help it grow and become efficient. * There are studies that have shown that the Tanzania shilling is overvalued; the rate of overvaluation being 1.1 percent per month since 1994. This has had effect on producer prices, lowering them by 70 percent in real terms. This in turn has reduced competition and investment in agricultural and export related activities because of low return. * Tanzania seems to have its priorities upside-down. Allocations to agriculture are not reflective of the role of agriculture, which is the main engine of the economy, employing 80 percent of the population. Failure to focus on agriculture will not allow GDP growth to go beyond the current 4.8 percent. Moreover, because of complementarity (raw materials, income/demand, etc.), poor performance in agriculture will also affect negatively performance in the industrial sector. There is thus a need to enhance growth in productive sectors or sectors that generate wealth if poverty is to be reduced. 131 * There has been a serious compression of demand in the Tanzanian economy. Whereas money/GDP ratio has been declining, tax/GDP ratio has been rising. This situation has affected profitability of most economic activities. The Government ought to stimulate the economy by focusing on the real side of the economy, especially fiscal stimulation involving sensible government spending on the productive side of the economy (roads, etc.) and reduction of nuisance taxes especially on raw materials while at the same time widening the tax base through encouraging growth and reducing tax evasion/leakage. * Noted by TRA official that revenue fluctuations are going to fall as the economy expands and production in taxable areas expands. This means, therefore, that tax reforms have to be implemented gradually, otherwise the stability of government revenue will be affected. P3: Enhancing Efficiency in the Public Sector Presentation * The presentation by the Permanent Secretary - Civil Service Department (CSD) highlighted the following: * Public Service Reform Program is a continuation of the Civil Service Reform Program (CSRP) 1993 - 1999, which focused on restructuring, cost cutting and institution building. The achievements of CSRP include: 25.7 percent reduction in workforce from350,000 to 260,000; reduction of ministerial divisions; training of 25,000 civil servants; launch of the Local Government Reform Program; and restructuring of regional administration reducing staff from 14,000 to 2,000. * The overall purpose of the PSRP is to continue reforming the public sector so that it provides support to the attainment of a high rate of economic growth and delivery of quality public services within priority sectors that conform to public expectations for value, satisfaction, and relevance by end 2011. The aims of the program reflect the Government's vision of the future public service as stated in the National Vision 2025. The Public Service will be an institution of excellence playing a pivotal role in achieving sustained economic growth and prosperity, and eradication of poverty in the 21" century. * The program development objective is to improve accountability, transparency and resource management for service delivery. The public service intends to deliver efficiently and effectively the Government's economic and social programs on a continuous and sustainable basis. In the medium-term (Phase 1), this development objective will be underpinned by the policy shift to outsource services to the private sector and to local authorities and the strategic theme to deliver quality public services under severe budgetary constraints. The program intends also to implement a medium term pay policy, implement job evaluation/re-grading exercise, efficiently reduce employment, develop the Public Service Commission, build capacity through training and retooling, and improve records management, IT and communications. The Global Distance Learning Network (GDLN), an integral part of the public 132 service reform program, was recently introduced in Tanzania. The network's center (GDLC), based at IFM, is intended to be part of a global knowledge-sharing network to strengthen the capacity of public and private decision-makers and implementers to design, plan and manage economic and social development policies. * Enhancing technical efficiency and public service organizations (MDAs) involves: (i) adopting and operationalizing Performance Improvement Model (PIM), which introduces results oriented management through performance improvement management systems; (ii) training ministries on PIM and empowering and energizing ministries to implement it; (iii) strengthening capacity and performance orientation in MDAs; (iv) rigorous application of meritocratic recruitment principles in personnel management; (v) putting in place an effective monitoring and evaluation system for institutional and individual performance; (vi) putting in place a fair compensation system and competitively remunerated public servants on the basis of medium term pay policy; (vii) introduction and application of Selective Accelerated Salary Enhancement (SASE) and Performance Improvement Funds (PIF) to strategically planned areas; (viii) operationalizing job evaluation and reducing distortions; and (ix) capacity building through training institutions - e.g., PSC, IDM and GDLC. * The PSRP total budget stands at $ 106.7 million. Commitments so far amount to $ 73.1 million, with the difference between total budget and commitments representing the shortfall. More donors are invited to contribute to the program, which is to be launched in June 2000. Discussion * Equal opportunities for men and women does not mean equal representation, but presence of representation. This has not always been the case in the Tanzania's civil service. The new public service reform program ought to also focus on tackling the gender imbalance problem. CSD has to address the issue of incentives like huge travel allowances. * Decline in accountability was noted. The report of the Controller and Auditor General showed poor certification in terms of adverse or qualified opinion. This was explained by embezzlement of cash and store, poor record keeping, etc. However, no follow-ups, sanctions and prosecutions are taking place. If donors have to channel their funds through the budget (basket funding, programs, etc) this trend has to change. * Duration of civil service reform is long and the cost is high but the results are unsatisfactory. The exercise seems to be very long and expensive and heavily based on the borrowed funds or grants from donors (WB and others). It is advisable that, instead of using the money to pay external consultants it is better to use the money for compensating retrenched employees and pay better those remaining. * It was also noted that jobs that have been reduced have not released enough resources for training other remaining staffs and improve services offered by the public sector. 133 Also sustainability of the civil service reform process was questioned as it depends on borrowed funds or grants from donors. Review of Fiscal Performance - An External Evaluation Presentation: * The presentation was done jointly by members of the PER Mission - one from The World Bank and another from the Embassy of Sweden * The analysis of fiscal performance was broken down into three distinct areas: aggregate fiscal discipline, strategic allocation, and technical efficiency. * Aggregate fiscal discipline: Domestic Revenue is still low standing at 11.5 percent of GDP in FY99 and FY00. Net foreign inflows in the form of grants and concessional loans increased from 4 percent of GDP to 4.4 percent in FY99 and are projected to further rise to 4.8 percent in FY00. The net foreign inflows contributed to a budget surplus of 0.3 percent of GDP in FY99. However, the budget situation is projected to turn into a deficit of 0.5 percent of GDP in FY00 due to increased public expenditure. Wage bill has shrunk from 4.2 percent of GDP to 3.7 due to civil servant retrenchment. However, the wage bill is projected to increase to 4.3 percent of GDP in FY00 because of the Pay Reform Program. After a continuous decline over the past few years, expenditure on other charges increased for the first time in FY99 to 5.7 percent of GDP up from 4.5 percent in FY98. During FY99, deviation of actual from budgeted figures at the aggregate level were less than in previous years. * Strategic allocation: Priority sectors (education, health, rural roads, water, agriculture and the Judiciary) benefited from the increase in other charges. The share of discretionary expenditures going to priority sectors increased form 42.8 percent in FY97 to 46.7 percent in FY00. Likewise, the share of development expenditure shifted to the priority sectors from 31.1 percent in FY98 to 61.7 percent in FY00. However, foreign development expenditure is still not captured in the government's accounts. * Technical Efficiency: Operational efficiency and service delivery remains constrained by low wages and salaries, insufficient of funds for operations and maintenance, and the unpredictability of resource availability due to the cash budget system in place. This trend is likely to change due to the recent increase in civil service salaries and expenditures on operations and maintenance. * Fiscal management efficiency is still weak. Audit certificates of accounts and statements issued by CAG continued to be predominantly adverse although there was some improvement in FY98 for ministries. Government continued the implementation of institutional reforms which are likely to considerably strengthen fiscal management. The ongoing reforms include the implementation of the Integrated Financial Management System, the legislation reforms underlying financial management, strengthening of the MTEF process, introduction of performance management systems and budgeting, strengthening of the auditor 134 general, the development of an Anti Corruption Strategy, and enhance integration of foreign aid into the budget process through the development of the Tanzania Assistance Strategy, Sector Development Programs in Health, Education, and Roads and basket funding arrangements in support of the Local Government Reform Program and the strengthening of the TRA. P5: Systemic Fiscal Issues Presentation: * The presentation was done jointly by members of the PER Mission - one from The World Bank and another from DFID, highlighting eight major emerging and continuing issues in fiscal management which need to be addressed. * The plight of the Development Budget: The development budget is in a very worrying state. Budget analytical work done under the PER FY00 process revealed four major disturbing features of the development budget in Tanzania. First, there is significant divergence between commitments and disbursements; and within the fiscal year, releases of funds are erratic constraining proper planning of commitments. Second, the development budget is characterized by a preponderance of extra budgetary financing particularly at regional and local government levels. Third, provision of counter-part funding, which is needed to trigger committed finance of development projects especially by the multilateral institutions, is inadequate. Last but not least, are the problems in the development budget process and the weaknesses in implementation capacity. The problems include a large number of institutions involved; guidance for prioritization is not provided sufficiently in the Medium Term Plan and Expenditure Framework; capacity constraints in the institutions concerned; weaknesses in the procurement system; and the problem of coordination between the roles of MOF and PLANCOM especially on sectoral issues. * Desirable Level of Revenue Mobilization: The dilemma is how to reconcile Tanzania's low tax effort with a relatively small easily accessible tax base. The Government in determining the desirable level and modalities for domestic revenue mobilization typically has to strike a balance between meeting demands for higher public expenditure, and therefore higher revenue mobilization, and lower taxation of private incomes. The demand for higher revenue mobilization comes from the severe under-funding of basic social services such as primary health and education and of physical infrastructure services, which have been identified as impediments to economic growth and progress in sustainable human development. It also arises from the desire for greater self-financing and low donor dependence in the longer term. On the other hand, the costs to large transfer of private resources to government are two- fold: withdrawal of resources from the private sector and inefficiency into the incentive system of an economy. It is important to point out that the key factor determining the desirability of domestic resource mobilization efforts has to be the effectiveness and efficiency of public spending. * Fiscal Restraint and Cash Budget Management System: The cash budget management system was introduced in FY97 to impose fiscal discipline on the 135 spending units and enforce limits on aggregate spending in line with collected revenue and external aid disbursed through the exchequer system. Despite the good objective, the system has entailed significant costs particularly in the form of unpredictable funding of essential public services leading to wide monthly swings in the funding of government operations to match revenue availability. In order to mitigate some of the negative effects of cash budgeting, borrowing to smooth fluctuations resulting from unpredictable monthly revenue flows is one recourse but the law restricts advances. However, the Government has recently allowed a number of Ministries to operate with three-month commitments instead of monthly ones. * Macroeconomic Stability and Debt Sustainability: A positive decision has been reached by financiers, which will allow Tanzania accede to the enhanced HIPC relief. The interim HIPC relief, through IDA and IMF grants, will enable the country to free up a sizable amount of its own resources for servicing multilateral debt. Given that the HIPC relief will be in the form of budgetary support, long-term, and irrevocable once the completion point is approved, the risks associated with the related expansion of the fiscal deficit (after grants) are not significant. One possible downside effect of this shift in fiscal stance, however, is that it is likely to increase relatively more expenditures on goods and services that are typically not traded internationally, leading to the strengthening of the shilling and reducing the competitiveness of Tanzanian goods. * Co-existence of Overall Fiscal Surplus Side by Side with Under-funding of Priority Sectors: The perception is that the Government is putting monies away (building up reserves) and/or availing it to the private sector (a better user) through the domestic banking system. However, a rise in gainful absorption of these resources by the private sector depends on the absorptive capacity of the private sector, which can be enhanced only if supportive infrastructure and better public service delivery can be financed. * Concern on Absorptive Capacity Constraint with Increasing Resources: This issue relates to the concern regarding possible limited of absorptive capacity of the Government for much larger expenditures. Currently the priority sector financing needs, based on the MTEF and related supportive technical studies, are grossly under- funded and absorption should not be a problem. Total available finance meets approximately only 60 percent of requirements. * Earmarking of Revenue and the Effectiveness of Budget Management: Revenue earmarking for specific expenditures is on an upward trend in Tanzania. The most significant among the earmarking arrangements is the Road Fund. Other forms of earmarking include retention of user charges for specific public services such as education, health, land services and natural resources. There are three reasons for starting to pay greater attention to the system of budget management before it mushrooms in an unwieldy fashion: to avoid undermining strategic budget allocations across sectors and geographical locations; the difficulty of enforcing overall cross sector and within sector allocation with the greater autonomy associated with revenue retention systems; and the likelihood of imposing excessive burdens on specific users 136 of public services, as the relevant sectors strive to raise the resource envelope within their control. * Predictability of Donor Resources: Tanzania is one of the major recipients of external assistance in Sub-Saharan Africa. However, donor co-ordination is tedious and requires more capacity at the Ministry of Finance. Donors have different accounting systems, different disbursement modalities and different financial years. To harmonize the multiplicity of the donor accounting systems, there are plans to integrate donor facilities in the new Integrated Financial Management System (IFMS) using the Platinum software. In addition, the Government is now taking the lead in preparing a country assistance strategy referred to as Tanzania Assistance Strategy (TAS). Unrecorded donor support is also among issues that are at the core of the debate on how to strengthen the government-donor partnership in development. Discussion/Comments On P4 And P5 * About 70% of the donor assistance are extra-budgetary. Donor countries need to do away with this situation. However, this calls for improvement in financial management and accountability. The scaring number of adverse opinion and qualified certificates need to be reduced. * It was noted that about 17% of the donors development assistance (DDA) to Tanzania is charged to non development programs. Corruption absorb the big part of the above mentioned share of DDA. Also expatriate and technical remuneration claims a substantial amount of it. On one hand the GOT needs to do whatever possible to stop corruption, and on the other hand, Donors needs to asses the amount of DDA that goes back in the form of expatriate and technical remuneration. * Fiscal policy is used in many countries in the world to address economic growth and competitiveness of the players in production. It is also high time for Tanzania to do the same. For instance there has been a practice of Government agencies to raise fees on inputs for the productive sector. If this is not coordinated it will discourage investment and production in productive sector. * None inclusion of various fees in the Road Fund was noted. Also counterpart funding is a serious problem. Low levels of counterpart funding lead to the loss of donor assistance. So, the Government needs to raise the level of counterpart funding. * While the Government is trying to raise revenue, tax exemptions have been increasing, at the same time the tax effort is very low. Also, it was noted that, there is no serious control of the government expenditure. The question was raised on whether the productive sector should be squeezed in favor of conspicuous consumption. * Not sure whether the figures/numbers on the donor funds that go through the budget are well captured. Figures/numbers are definitely high since much of the figures are now captured in the MDF basket funds. PER WG should try to investigate whether there can be any possibility of predicting donor funds. 137 * Inclusion of Judiciary in priority sectors was welcomed by the participants. However, it was noted that allocation to the sector is to small to reflect it as a priority sector. * There is a persistence in making mistakes in the development budget. Deviations between budgeted and actual development expenditure have been so consistent but there has been no learning. While resources are there and others come in (through donor assistance) actual development expenditure has been far less than the budgeted amount. Solutions suggested to this are: First, as a sector develop, credible development program it should get more resources. Secondly, Government agents, ministries and departments should get earmarked resources since it gives them autonomy in terms of controlling the source of resources. P6: HIV/AIDS AS A DEVELOPMENT PROBLEM Presentation - by Planning Commission * During the early 1980's when the rate of HIV/AIDS infection was low the disease was considered an exclusive concern of the health sector. Curative and preventive measures were solely left to the ministries and institutions responsible for health affairs. As the infection rates gain momentum and more information becomes available, it became evident that the disease is a global and multi-sectoral problem that impacts all sectors of society. The fight against HIV/AIDS requires the joint effort of entire international and local community. * HIV/AIDS represents a serious crisis for development in large parts of the developing world where it is rapidly reversing social and economic achievements. The HIV/AIDS epidemic has spread with ferocious speed. HIV/AIDS has now infected 50 million people worldwide. More than 16 million have died, 2.6 million in 1999 alone. Today, about 36 million people are estimated to be living with HIV/AIDS, 95% of them in developing countries * In most affected countries HIV/AIDS is swiftly dismantling the development achievements of the post 50 years. Life expectancy is now declining in many countries after decades of progress. In several nations it has been shortened by 10 years. Adult mortality rate has risen by 50% in many countries and by 100% in most affected countries. Child mortality rates have doubled in many countries and could double again if HIV/AIDS continues unchecked. The rapid rise in adult deaths is leaving a large number of orphans, 11.2 million worldwide, 10.7 million of them in Africa alone. * Recent World Bank estimates suggest that HIV/AIDS has a substantial negative impact on economic growth. In general, it is the 15-49 age group that is disproportionately affected by HIV/AIDS epidemic. Through its impact on the labor force. HIV/AIDS diminishes productivity just as developing countries need to become more competitive to cope with rapid globalization. All sectors are affected. HIV/AIDS illness and care reduces time and labor used in vital work of agriculture. HIV/AIDS also undermine PSD development by removing skilled labor, increasing expenditure, and reducing revenues. 138 * HIV/AIDS overtaxes social systems and the health and educational development that the poor need to escape poverty. Across Africa HIV/AIDS has drained skilled manpower in every sector, which was scarce to begin with. Teachers and student are dying or leaving school because they can longer afford it, have fallen ill, or because they are needed at home or to care for the sick. Health care system in many countries are stretched beyond their limits as they deal with a growing number of HIV/AIDS patients and the loss of health personnel to illness and death. HIV/AIDS has also caused the loss of policy makers and managers for the overall operation of the Government. * Women in general, and girls in particular, are biologically and socially more vulnerable to HIV/AIDS and are disproportionately infected and affected by the epidemic. Women and girls also bear the greatest burden of care; families often take girls out of school to care for the sick relatives or assume family responsibilities, jeopardizing recent gains in health, nutrition and girls' education. It is worth to note is that, HIV/AIDS particularly targets the poor. The epidemic has overwhelmingly hit the world's poor countries and those with the greatest disparities of income. * HIV/AIDS has been in Tanzania for about 17 years now. The number of adult HIV/AIDS infection in Tanzania in 1997 is estimated to be 1.5 million (NACP, 1998). Given the fatality of the illness, and with 1.5 million infected productive adults, the HIV/AIDS epidemic can no longer be viewed as just a health problem, it has to be recognized as a development problem. In terms of geographical distribution the five leading regions in HIV/AIDS cases are Mbeya, Dar es Salaam, Kilimanjaro, Mwanza and Kagera. * The Way Out: As it has been shown HIV/AIDS is a multi-sectoral problem both in terms of its causes as well as its solution. Therefore the fight against AIDS requires a multisectoral approach/program that addresses all fronts and involves all the social economic agencies both at the country, regional, and global levels. At the country level the obvious actors are the Government (central and local), the private sector, the civil society including non governmental organizations (NGOs), communities and households. The war against HIV/AIDS must be fought on three fronts, curative, preventive and promotive activities. * Tanzania has adopted the MTP III as our comprehensive multisectoral program for HIV/AIDS control. MTP III is a multisectoral unti-HIV/AIDS program that addresses all frontiers and tries to involve all important actors. However, while MTP III is an important anti-HIV/AIDS program for Tanzania, it is not adequate for the purpose as it is unable and it was not meant to address some of the critical factors that are known to cause/influence the spread of HIV/AIDS. Other supportive frameworks such as the Development Vision 2025, the Poverty Eradication Strategy, the Poverty Reduction Strategy under HIPC initiative etc. will assist in mobilizing political support and the masses for participating in activities that will eventually fight the spread of HIV/AID. * Some important constraints to consider: Both MTP III and Vision 2025 were passed before the end of 1999. But their effective implementation is yet to begin. While the detailed implementation plans are still under preparation, implementation work will 139 require massive resources particularly budgetary resources and the supply of those resources is the most challenging problem being faced. Discussion/Comments on P6 * The inclusion of the HIV/AIDS in the PER as the main issue was welcomed by the participants. It was noted that many programs including MTP3 have been put forward to deal with the problem but with not much success. It was proposed that: (i) Political leaders should speak out clear and louder. HIV/AIDS should come out clearly in every meeting, seminar, workshop, etc. (ii) MoF should approach the donors on what they can do to tackle this problem (iii) Develop new international coordination with other African countries to combat the issue internationally. (iv) Interest of the donors to help combat HIV/AIDS, through more local network funding. * Observation on the problem has been as follows: (i) Intensification of the proposed focus on multisectoral HIV/AIDS approach. Indicate how the available funds will help to combat the problem. (ii) Most of the institutions dealing with the problem may not have enough capacity to deal with the problem. So they need assistance in terms of human capacity. (iii) Indicators should be set so that progress can be monitored and assessed. (iv) Systematization and human rights should be put in place while fighting the problem. * Much more details of HIV/AIDS from the sectoral paper is needed. HIV/AIDS is the problem that should be addressed by the Government. Government should come out with a clear plan of how to deal with the problem. 'What should a nation do when it is in a war?' 'It should mobilize resources for the war'. Why seeking money which we can't disburse? HIV/AIDS should be moved to the top of the agenda and hence attract more resources. It was noted that ADB is ready to cooperate with other donors to help the Government to strengthen HIV/AIDS control programs. * Numbers/figures should be given in terms of caring HIV/AIDS affected person or caring orphan. The budget should indicate whether we are going in the right direction or not. It was noted that more than 16% of the affected people are children. Care and counseling should involve everybody in the community. * People in laboratories are limited. Also facilities for screening are limited, hence increase the spread of the problem. * There are success stories in reducing HIV/AIDS cases in some countries like Uganda and Senegal. Studies by GTZ have shown a decline in HIV/AIDS cases in some region ofTanzania. For instance, 10 years experience for Mbeya has shown that HIV/AIDS figures have gone down from 20% to 15%, and from 15% to 5% for syphilis. The decline in these figures shows that there is a way to reduce the extent of the problem. * Things to be noted by the Government: (i) Intensify awareness program. (ii) Enact legislation that can punish those who deliberately spread HIV/AIDS. (iii) Proper funding of the programs that are against HIV/AIDS. (iv) Stop those people who claim to have cure for aids as they draw away the resources of the poor people. 140 P7: CROSS-SECTOR MTEF Presentation - By the Commissioner for Policy Analysis, Ministry of Finance * The fiscal year FYO1 will be the second year since the introduction of MTEF approach to the Tanzania budget planning process linking policy, planning and budgeting in a medium term framework. This MTEF is built on the foundation of the projected resource envelope and expenditure priorities consistent with the agreed macroeconomic and sectoral objectives. The presence of HIPC debt relief as well as the continued inflow of donor support has helped to enhance the predictability of the resource envelope for the budget. Resulting from this enhanced resource level, the expenditure allocations in the next MTEF particularly for priority sectors and activities, have been increased significantly when compared to allocations to other sectors and activities. The first MTEF for Tanzania was confined only to the five priority sectors (education, health, water, agriculture and roads). During the PER FY FY99 consultative meeting it was felt that there was a need to extend the coverage of the MTEF to other sectors on the basis that the exercise needs to be seen in the context of the broader public sector management reform and therefore has to involve all sectors of the government, including the Ministry of Finance and Planning Commission. * In analyzing sectoral allocations, expenditure is divided into the following main sectors: Administration, Law and Order, Social Service, Economic Service, and Consolidated Fund Service (CFS). The analysis focus is on two dimensions,: sectoral allocation by shares, and deviations of actual sectoral expenditure from budgeted sectoral allocations. * Sectoral allocation by shares: During the past two years (i.e. FY98 and FY99), average shares of actual spending as a percentage of the actual total sectoral recurrent expenditure were: CFS (33.6%), social services (28.5%), productive services (3.3%), economic services (3.2%), Law and Order (17.0%), and administration (14.4%). Comparing the two years, the shares of recurrent expenditure on Social Services, and Law and Order increased while shares of the other four sectors decreased. Increase in expenditure shares on Social Services shows the Government's commitment toward improving social service delivery. With regard to development expenditures the average shares were: Administration (12.7%), Law and Order(0.1%), Social Services (36.2%), Economic services (40.1%), Productive services (10.9%), and CFS (0.0%). The much faster increase in the actual development expenditure on social services and economic services reflects the Government's intention to develop the two key sectors. * Deviations of actual sectoral expenditure from budgeted sectoral allocations: Under this, most of the sectors under-spent. The highest under-spending occurred in Economic Services (-30.6%) while the highest and only over-spending occurred in CFS (+22.2%) for the same period. Looking at the deviations for the two respective years, deviations for FY98 range from -30.6% to +22.2% while for the year FY99 range from -9.0% (for Administration) to +3.6% (for Social Services). This shows 141 that actual sectoral recurrent expenditure for FY99 was more consistent with the budgeted allocations than the year earlier. * Outstanding Priority Sector Issues: Notwithstanding recent gains in some macroeconomic variables, there are outstanding problems in the sectors. Such problems are manifested in the following outcomes. (i) The continued downward trend in the status of human development indicators and quality of social services particularly in education, health, nutrition, water and sanitation. (ii) Weak and low growth of the agriculture sector relative to its potential. (iii) Inadequate investment in physical infrastructure notably transport, marketing and processing. (iv) Vulnerable balance of payments position due to adverse developments in the international environment such as a decline in commodity prices, rising import prices and erratic recovery of the export sector. (v) Lack of micro-finance services. * Along with the broader objective of enhancing sustainable economic growth and poverty eradication, the Government will address those problems through the MTEF process. The overall objectives of the government for priority sectors up to the year 2002/03: * For the education sector the overall objectives continued to be: to increase enrolment of pupils in primary education by 10% annually; to increase transition rate of primary to secondary level from 15% to 21%; to improve the quality of teachers through in- service and pre-service training at the rate of 30% annually; to increase enrolment in higher learning institutions, promote gender equity and improve training; and to increase the capacity and improve inspection services coverage from 50% to 70%. * For the health sector, the main thrust of the MTEF for FY01-FYO3, is to improve primary health care by focusing on equity with emphasis on capacity building, improvement of service delivery and provision of drugs, medical supplies and HIV/AIDS educational contact. * For the water sector the overall objective is to increase access to clean, safe and adequate water supply by at least 9% points for the rural population and 7% points for the urban population. * For the agricultural sector, the government will continue to avail public resources to the sector's strategic priority activities, namely: extension services, research, regulatory services, promotion of functioning co-operative societies, marketing information and agricultural statistics, early warning systems and food security management. * For the road sub-sector, issues that have high priority include: road maintenance of an upgraded network; implementation of priority rehabilitation and upgrading projects; and rehabilitation and maintenance of rural roads under the local government authorities' jurisdiction. * With regard to the land sector, priority will be given to the key areas directly related to the operationalization of the new land policy and law. These key areas are land resource management; land tenure security enhancement; land information 142 management, and speeding up the processes for issuing land titles and resolution of land disputes. * Good governance in the context of this MTEF includes: enforcing law and order (in particular the judiciary); general election; the national population census; implementation of the National Vision 2025; the anticorruption strategy; and the control and audit. The Budget Frame * Specific Consideration in Developing the Budget Frame: Specific considerations that guided the development up of the budget frame were as follows: (i) the draft budget frame prepared by the MOF was adopted as the baseline scenario, (ii) the resource envelope as projected in the baseline scenario was re-examined to correct for the declining tax effort (tax/GDP ratio) over time, (iii) the upper case scenario is to include additional resource projection from the enhanced HIPC and the possible offsets between expected resources from the MDF and the HIPC debt relief, (iv) projections of external resources (loans and grants) were based on likely turn-out figures informed through questionnaire survey of all DAC donors, (v) the level of the fiscal deficit ought to be consistent with the government macroeconomic policies to ensure sustained macroeconomic stability, and (vi) exchange rate of Tshs. 750 to the USD is an underestimate. * Underlying Assumptions of the Budget Frame: The macroeconomic policy targets for the MTEF FY01 - FY03 underlie assumptions that guided the development of the budget frame: (i) Real economic growth of 5.8% in 2000 rising progressively to 6.9% by the year 2003, (ii) Consumer price inflation of 5.0% is expected to decline consistent with the inflation trend of the trading partners, (iii) Revenue collection is targeted at 13.0 percent of GDP at market price in FY03 (iv) A decline in broad money supply (M3), (v) Increase in foreign reserves to the equivalent of 4 months of imports of goods and services by end 2000, and (vi) An average exchange rate of between Tshs. 800-850 to one USD is projected for FY01. * Resource Allocation Criteria: In terms of the criteria used to allocate additional resources the following principles were applied: (i) Priority areas should be the beneficiaries of additional resources after funding PE, general elections, national population census and build-up to the government pension fund (ii) Additional resources should fund non-wage expenditures - both OC (recurrent expenditure) and development expenditure (iii) Priority activities within priority sectors should be targeted in allocating expenditures so as to have the maximum impact on poverty reduction (iv) Allocations to non-priority sectors were to be maintained at the same level in real terms. (v) The division between PE and OC be such that all additional resources allocated to the priority sectors were to go to OC (vi) In deciding the allocations between sectors, the same proportions as in the Budget Guidelines were applied. (vii) As regards allocation within sectors, use was made of the sector development programs and studies/reports that were commissioned to update expenditure plans for the priority sectors covered by the PER FY99. Discussion and Comments on P7 143 * The major source of funds allocated to the roads sector is the Road Fund but this does not cover all requirements. There should be additional funds for development purposes of roads from the Government budget. * Private sector is neither involved in the PER process nor the MTEF preparation although it is involved in paying taxes and creating jobs. There is need of including private sector in the permanent PER Macro group. * It was also noted that there is inconsistency in numbers in the cross sector MTEF especially for the education sector and health sector numbers. * Allocation to priority sectors (specifically agriculture and roads) is so minimal that it does not reflect priority of the sectors. For instance allocation to roads is not enough to cover required road maintenance targets, hence leading to fast deterioration of the road network. * Clarification on the participation of the private sector in the PER process was made as follows: "Private sector participate full in the PER Working Group but not in the PER Macro Group, but the final numbers/figures are presented to the PER WG, in which the private sector is represented. However, in the future the private sector will be represented in the PER Macro group. * Clarification on the Road Fund was as follows: Road Fund numbers are indicative. Further more Tsh. 5/= billion. has been set as the provision for development budget in the roads sector. However, one has to note that given fixed nature of resource envelope, trade-offs would mean shifting of resources from one sector in order to add to the other. * In the future there is a need to see whether it is possible to reallocate resources for development purposes to the maintenance of roads in case there are shortfalls on the recurrent side. P8: EDUCATION SECTOR MTEF Presentation - By Permanent Secretary Ministry of Education and Culture * The education sector has formulated several policies including the Education and Training Policy, Higher Education Policy, Science and Technology Policy and Technical Education Policy. The implementation of these policies has triggered the development of the Education Sector Development Program (ESDP). The ESDP provides for an opportunity to address issues and problems caused by large numbers of uncoordinated development programs/projects. It strengthens sector management by bringing all donor and government funding capital and recurrent within a single planning and implementation framework in support of an agreed sector strategy. * General Trend of Education Financing: The sub-sector financing shows that basic education is mainly financed by the Central Government, followed by external donors and parents. Donor contribution in the education sector appear to be increasing, with growing priority given to basic education. A number of initiatives are underway that might help to increase funding of the sector. These include the following: a national 144 education levy; household involvement in site construction/rehabilitation of classrooms and teachers houses; contribution to a revolving fund for textbook, and a contribution to the cost of school inspection; and district education trust funds. * For recurrent expenditure: The major financing source has been the Central Government. These are categorized into PE, OC and student direct costs. Since the financial year 1992/93, the Government introduced cost sharing in phases. Total real government expenditure has increased over the last 10 years. However, public sector spending on education is low (only 2.6% of GDP) compared with other countries like Kenya (6.1%), Uganda (2.9%) and South Africa (6.4%). Between 1993 and 1998 the share allocated to primary education rose from 51% (1993) to 67% in 1998, falling slightly to 62% in 1999. Secondary education received 7% of the sector budget in 1999 compared to 15%, six years earlier, a reduction of 53%. The shares of the recurrent budget allocated to teachers training and administration have fallen by 60% and 44% respectively. Expenditure on Higher and Technical education almost stagnated up to 1997 with slight improvement in 1999. The pattern of recurrent expenditure shows that in primary education, personal emoluments have averaged 96% of total government recurrent expenditure since 1995, in secondary education, it has averaged 63%, while in teacher training it has averaged 69% of government recurrent expenditure since 1996. * As regards development expenditure, for several years the Government has not funded research costs in higher education. The donor community has been the main source of financing the cost of research and other development costs in higher education. In real terms, development expenditure on education appears to be increasing, albeit from a low level, considering the sector's share of the recurrent budget. * Mobilization of Funds: For some time, the financing burden for the education sector has been shifting from public to private sources. There are other sources of financing which include: (i) District Education Trust Funds - under ESDP, each district is required to establish a District Education Trust Fund primarily for financing education activities. (ii) Education Levy - it is envisaged that the fund would serve the resource mobilization function and the grant and resource allocation function. * Performance Indicators in Basic, Secondary, Teacher Training, Higher and Technical Education: In general, the performance of the basic education sub-sector has declined and that of secondary education has improved even if the overall results are still poor. In teacher training, internal efficiency has fallen by half, while in Higher and Technical education the student/teacher ratio still remains very low. It lies between 1:4 and 1:1 in some courses like nursing. * Sector Priorities: The establishment of the Education Sector Development Program (ESDP), within the Tanzania Development Vision 2025, aims at achieving high quality livelihood for all Tanzanians through realization of Universal Primary Education, the eradication of illiteracy and attainment of quality human resources required to effectively respond to the developmental challenges of a changing environment. The Medium Term Plan therefore tries to bring on board priority programs that are logical bases as well as catalysts that strengthen the effective and 145 efficient implementation of programs. The Medium Term Plan is aimed at the learner. However, prioritization in any sector is inevitable particularly in the context of scarce resources while competing needs are numerous. The thrust of the Medium Term Plan is to enhance learning achievement. This period the ESDP will address the following priorities: to improve the learning environment at all levels; to strengthen the management capacity at national, district, and institutional levels; to improve Education Management Information System (EMIS); and to control the spread of HIV/AIDS/STI through the education system. * Sector Main Problems: The problems include: Low enrolment rates, low quality, low transition, inequitable provision of services, high costs, low parental contributions and effective demand for education, weak quality control in higher education, and low patterns of expansion for higher education. * Expenditure Projections: The government has decided to accord high priority to the education sector, which is a symbol of recognition of its pivotal role in the development of the nation. The education share of the discretionary budget had been rising since independence. P9: THE HEALTH SECTOR - MTEF Presentation - by the Permanent Secretary Ministry of Health * The Health System Network: The Tanzanian health network consists about 4844 facilities that are well distributed across the country of these facilities, 2877 belong to the government. Analysis of Disease (1995 Study) patterns and trends show that the burden of disease is mainly concentrated on communicable and preventable diseases that can be controlled through effective preventive and promotive health programs at district and primary levels. * Health Sector Reforms: The ministry initiated and proposed major reforms in the sector to rationalize the roles and responsibilities in the provision and financing of health services. * Health Policy Objectives: The overall objective of the Government of Tanzania's health policy is to improve health and well-being of all Tanzanians with a focus on those most at risk and to encourage the health system to be more responsive to the needs of the people. * Specific Objectives: To achieve its overall objective, the Government of Tanzania aims to (i) reduce infant and maternal mortality, morbidity and increase life expectancy; (ii) ensure that quality health services are available and accessible; (iii) move towards self sufficiency and equitable distribution of human resources by training all cadres required at all levels; (iv) sensitize the community on common preventable health problems and improve capacity at all levels of society; (v) promote awareness in government and community at large that health problems can only be adequately addressed through multi-sectoral co-operation and sector wide approaches; (vi) create awareness through family health promotion that responsibility for one's health rests squarely with the able-bodied individuals as an integrated part 146 of the family; and (vii) public/private mix will be promoted in the delivery of health services. * Immediate Objectives: The Ministry of Health, following the thrust of the on-going health reforms, will take the process forward in the Plan of Work with the following underlying immediate objectives: (i) priority attention to improved access, equality and efficiency of primary health (district level) services; (ii) strengthen and reorient secondary and tertiary services delivery to support primary health care services; (iii) improve the capacity for policy development and analysis, development of guidelines for national implementation, performance monitoring and evaluation, legislation and regulation of service delivery and health professionals; (vi) implement a human resource program to train adequate numbers of health staff to manage the services (primary, secondary and tertiary); (v) strengthen the national support systems for personnel management, drugs and supplies, medical equipment and physical infrastructure management, transport management and communication; (vi) increased and varied financing sources for health care delivery and improved financial management; (vii) increased private sector involvement in the delivery of public health services; and (viii) within the sector-wide approach, improve the relationship between all partners, and institute mechanisms to ensure that support to the health sector is addressed in its totality with sharing of information and actions. * Implementation Strategies: In order to meet the challenges of providing health services within the Health Sector Reform agenda, eight inter-linked strategies have been developed to address the above mentioned immediate objectives. The idea behind these strategies are that: (i) more resources will be injected into the health system and existing resources will be used efficiently; (ii) resources will be distributed more equitably; (iii) priorities, objectives and standards will be clearly defined and monitored; (iv) managers at all institutional levels will have greater authority in the planning, allocation and use of available resources; (v) staff will be better motivated through improvement in working environment; and (vi) drugs and essential supplies to be made available as required. * In order to implement these strategies, a phased three-year development program of work has been developed. * Priority Areas: The priority areas focus on facilitating and strengthen the delivery of health services to comply with the essential district health package as well as to arrest the further deterioration of the physical facilities. The following priority areas are therefore recommended: (i) drugs and essential medical supplies; (ii) kerosene for storage of vaccines in rural areas; (iii) essential hospital equipment and supplies; (iv) strengthening of the referral system; (v) equipment for safe motherhood for all levels; (vi) conditional survey of physical facilities and equipment and prioritization for urgent rehabilitation of the most critical ones; (vii) mechanisms for introduction of CHF and cost sharing to lower level facilities; (viii) mechanisms for implementation of the National Insurance Fund; (ix) improved health education strategies; and (x) development and institutionalization of the health sector reform strategies. * The following are the key components pertaining the above priority areas and which need to be strengthened: (i) Sector Financing; (ii) Sector Monitoring and Evaluation; 147 (iii) Sector Financial Management; (iv) District Health Management; and (v) Health Network Rationalization. * Health Sector Overall Expenditure Performance FY1997-2000: In the past 2 years and half of the current fiscal year, the amount of funds released was more than what was budgeted for the sector. This was intended to alleviate the shortage of drugs in most of health facilities. * Financial Resources and Medium Term Framework for the 2000-2003: The government, donors and contributions from members of the community mainly fund the health sector. Donors mainly support vertical programs. Trends in the government expenditure on health therefore indicate a notable under-funding at all levels of the sector. * Way Forward (2000-2003): (i) Planned activities in year one shall be budgeted within existing resource envelope; (ii) New reform activities will continue to be funded over and above committed and tied funding by donors and government, partners and other donors; (iii) This year, most of the reform activities will be integrated into the Annual Development and Recurrent Expenditure books; (iv) The MOH will continue with the introduction of policy objectives and targets that will allow identification of scarce resources and the need for greater inputs over time; (v) MOH will continue to emphasize on the need to integrate vertical programs into sectoral and district plans and budgets so that most of the vertical program funds are reflected in government budget books in order to develop comprehensive health plans at all levels; (vi) The MOH will continue with its efforts to assist the regions and districts to build their capacity in planning, management and supervision; and (vii) MTEF will eventually show an integrated budget frame for all activities. Discussion/Comments on P8 and P9 * There is a need to link the Education and Health MTEF document with the TAS document. * Performance indicators in education are worrying. One wonders why so much resources (money) have been put in to the education sector without making difference. There is a need of reconsidering the main problems facing the sector once again. * There is a need to study why primary education is under performing as compared to secondary education * There is poor management of the resources available in the education sector and not the issue of cutting down administration. It is noted that there is under spending of the money provided to the sector (by Swedish and other donors). * Problem of data inconsistencies between the cross sector MTEF and sector MTEFs figures. * Education fund is contributed indirectly and directly by levies. However, donors were asked to assist in developing this fund. 148 * Human resources need to be considered as a priority area. * There is a very long list of priorities in the education sector. Hence, translation of priorities and objectives into expenditure is not consistent with overall resource envelope. There is need of redefining the absolute priorities consistent with the resource envelope. * No development expenditure for development of teachers although it is a priority area in the education sector. P10: WATER SECTOR - MTEF Presentation - by the Permanent Secretary Ministry of Water. * National Goal: The national goal focuses on universal access to safe water by the year 2025. This goal shall be fulfilled through proper, efficient exploitation of water resources for enhanced socio-economic development by providing clean, safe and adequate water and wastewater disposal system. * Vision: The Ministry of Water aims to achieve sustainable water resources development and management which is responsive to the needs, interests and priorities of the Tanzania population including men and women, both in rural and urban areas. * Mission: The Mission of the Ministry of Water is to ensure water resources management and developments are carried out in collaboration with all stakeholders in an economic, environment and social sustainable manner. To fulfill this, the MOW will undertake the following: * Facilitation, co-ordination, monitoring and regulation provision of water and sanitation services to the public with a gender perspective. * Formulate a realistic, comprehensive, dynamic and gender sensitive water policy which takes into account other related policies, * Develop competent sector professionals of high integrity. * Medium Term Objectives: The main focus for the water sector during FY01 - FY03 will be to rehabilitate and expand and expand water and sanitation facilities, and install efficient management to bring the service level from 48.5% to 50% of the rural population and from 68% to 70% of the urban sector by year 2002/03. This will be achieved by fulfilling the following objectives. (i) Revision of the National Water Policy by year 2001, (ii) Facilitation of the sustainable provision of adequate, safe and clean water for different social groups in rural and urban areas between years 2000 and 2003: rural areas (from 48.5% to 55% of population coverage) and urban areas (from 68% to 75% of population coverage). (iii) Facilitation of the development of urban sewerage and drainage facilities form 10% population coverage in 2000 to 25% population coverage by the year 2003. (iv) Improvement of water resources monitoring infrastructure from 20% in 2000 to 40% by the year 2003. (vi) Protection of water resources in order to control pollution levels from 30% in 2000 to 10% by year 2003. (vii) Development of professionals of high integrity with gender capacities 149 for effective and efficient development and management of Water Sector from 60% in 2000 to 80% by the year 2003. * Medium Term Expenditure Strategies: (i) Facilitation, regulation, promotion of the participation of the private sector and composition of the Water Resources Management Policy, as a part of the National Water Policy. (ii) Construction and rehabilitation of Water Schemes in rural areas, starting with semi-arid areas/regions. (iii) Rehabilitation and expansion of water schemes in urban and peri-urban areas - regional and district headquarters. (iv) Rehabilitate and expand the schemes for sanitation services in urban areas to meet the demand. (v) Rehabilitation and expansion of hydrometric and meteorological network for the sake of reliable database for realistic sector planning. (vi) Establishment of environmental conservation and pollution control networks for water sources. (vii) Training of gender sensitive and competent professionals for the water sector, technicians, engineers and water resources scientists. PH1: ROAD SECTOR - MTEF Presentation - by the Permanent Secretary Ministry of Works * The road network in Tanzania comprises approximately 85,000 km of roads, classified into three overall categories: trunk roads; regional roads including essential This year's MTEF of the Ministry of Works (MOW) differs from last year's by its inclusion of institutional changes in the road sector, specifically the creation of TANROADS. The new organization is a semi-autonomous executive agency dedicated to the management of the road network and execution of future maintenance and rehabilitation of the road network. * district and feeder roads; and district and feeder roads. * According to the MOW estimates, only 15% of the trunk and 10% of regional roads were in good condition prior to the commencement of IRP in 1990. Although progress has been achieved on the paved trunk roads, the following deficiencies have occurred: (i) While the number of km paved trunk road in good condition has increased, the overall percentage of trunk roads in good condition has decreased by 3% from 1997 to 1999. (ii) There has been a significant decrease in the number of km of trunk road in fair condition, with a corresponding increase of those in poor condition. (iii) The number of km of regional roads in good condition has been reduced from 18% in 1997 to 15% in 1999. (iv) There has been a 2% decrease in the number of km of regional roads in fair condition. (v) There has been a 5% increase in the number of km of regional roads in poor condition. This information paints a rather negative picture of the achievements in the road sector. However, it is difficult to draw any conclusions as to the effectiveness of the road maintenance carried out. This is due to the consequences of El Nino weather phenomenon in FY98 and the mode of survey which relies on visual inspection, and thus which is prone to subjective interpretation. * Vision: The Tanzania development vision 2025 accords very high priority to investment in infrastructure. In particular, the development of the road network is 150 judged to be absolutely essential for promoting rural development. Consequently, the Government's mission and vision for the development of the sector is focused at improving the national road network. * Organization and Management of the Road Sector: In order to strengthen the organization and the management of the sector the government embarked on various steps: the FY99 transfer of the responsibility for maintenance and development of district roads to the Ministry of Regional Administration and Local Government (previously under the Prime Minister's Office); the adoption of a new institutional structure for the road sector through amendment of the Roads Toll Act in order to create a dedicated Road Fund to be managed by a Road Fund Board; and the establishment of a semi-autonomous road agency TANROADS under the Executive Agencies Act which will be responsible for road maintenance and development of the road network (previously under the department of roads-MOW). * Review of the past expenditure performance FY98 - FY00: * The level of expenditure by the Ministry of Works has fluctuated in both real and nominal terms. Comparison of actual releases with budgeted funds shows that actual released funds have in most cases been far less than the budgeted amounts. This has also been the case for both the development and recurrent budget. In FY00 however, recurrent costs surpassed the budget by 2% due to the fact that the development funds were dedicated to the maintenance of road infrastructure that was destroyed by El Nino. * In FY 98, actual non-salary expenditures were less than the budgeted amounts for most sub-votes. The ratio of actual PE allocations to budget was close to or above 100% except for sub-vote 103 (Policy) FY99 shows a different picture: overall, releases for non-salary expenditures (other charges) were higher than the budgeted amounts; on average, there was a shortfall in the total PE actual allocations to budget. There were many cases of over-expenditure in most sub-votes, the largest being in Sub-vote 102 (Finance and Accounts). The road sub-vote is still given the top priority in the Ministry of Works, receiving more than 90% of total resources. * Over the past three years, government expenditure in the roads sector has focused mainly on three main areas: emergency maintenance of roads such as those damaged by El-Nino rains during FY98; maintenance of the rehabilitated/upgraded road network; and implementation of priority rehabilitation and upgrading projects. For the period FY98 and FY99, the actual allocation of funds for road maintenance activities averaged about 57% and 89% of the road maintenance budget, respectively. As a proportion of the total maintenance and rehabilitation budget, actual expenditure on road maintenance averaged 37% and 44% respectively during the same period. The actual allocation of funds for road rehabilitation was 76% and 73% of the budget in FY98 and FY99. As a proportion of the total budget, funds allocated for rehabilitation averaged 63% and 56% during the same period. * The Medium Term Expenditure Framework: According to the revenue projections, there will be a significantly reduced resource envelope for the roads sector. This conclusion is based on the Tshs 22,443 million collected as Road Fund 151 revenue up to 31st January, 2000 and the identical growth rates as those used in the budget guidelines. For this reason, measures will have to be taken either to enhance revenue collection, or to readjust expenditure plans downward in accordance with the revenue shortfall. There are three options for implementing the above measures: controlling fuel smuggling and dumping; changing the tax structure on fuel products to raise the fuel levy; or limiting Road Fund resources to the maintenance of a strategic road network. The distribution of the Road Fund resources between maintenance and development is based on the proposed distribution set out in the Road Fund Act as well as that which is determined by the government. According to the distribution: maintenance of Trunk and Regional Roads receives 63%; development of Trunk and Regional Roads 7%; maintenance of District, Rural, Feeder Roads 27%; and development of District , Rural Feeder Roads 3%. According to the budget guidelines for the period FYO1-FYO3 the roads sector will continue giving high priority to the following areas: road maintenance of upgraded network; implementation of priority rehabilitation and upgrading projects; and rehabilitation and maintenance of rural roads under local Government authorities jurisdiction under MRALG. Budget Strategy for the Road Sector: In order for Ministry of Works to achieve its strategic objectives in the road sector for the coming three years with the resources available, the following actions need to be taken: dedication of Road Fund to maintenance and development of the strategic network; conducting detailed annual road condition and traffic survey; putting in place measures to control fuel dumping and smuggling; assessment of impact of past maintenance efforts; and change the tax structure for petroleum products. P12: JUSTICE & CONSTITUTIONAL AFFAIRS - MTEF Presentation - by the Permanent Secretary Ministry of Justice and Constitutional affairs * An efficient, fair and transparent system of justice is crucial for securing and perpetuating an enabling environment for the peaceful and dynamic social and political development and prosperity of the nation. This is the main reason why the Government is committed to institute and execute the reform and development of the legal and judicial service in the country. * Vision and Mission: The vision of the Ministry for the next three years is accessible and timely justice for all. In line with the overall vision the Mission of the Ministry is the development of social justice, equality and rule of law, constitutionalism, fundamental human rights, equality and social justice, equality of all before the law, ethical and fair conduct by law enforcement officers, accessibility and affordability of legal services for all citizens, efficient and timely resolution of disputes, transparency and accountability. * Government Expenditure on MJCA: The MJCA has for a long been accorded a very low priority in the allocation of budgetary resources, the provision of the basic infrastructure and facilities, and in public esteem generally. Between the years FY98 and FY99, the share of MJCA in total government actual expenditure increased only 152 marginally from 1.08% to 1.2%. The share of the sector in government actual recurrent expenditure remained more or less constant at 1.3%, while that of development expenditure dropped drastically from 0.05% in FY98 to 0.01 in FY99. Within the Ministry, the budget expenditure is distributed into the three independent departments: the Judiciary Department, the Justice Department and the Law Reform Commission. The Judiciary department got the largest share, over 70% of the budget of the FY98 and FY99 fiscal years. The AGC department got less than 30% of the budget during the period while the Law Reform Commission share was less than 2% only. Most of the expenditure in the departments was directed into recurrent expenditure with only the AGC department having some small development expenditure. Like most other ministries, the MJCA has been receiving very little or no development funds. Only recently has the MJCA been included in the cluster of priorities, which include such other institutions as social services, infrastructure and agriculture. Most of the development funding to the MJCA has been coming from the donor community. * Performance Indicators of the MJCA: These include efficiency, effectiveness, outcome indicator and the work process indicator. Available information suggests that efficiency is at a reasonable status. Effectiveness is still hindered by inadequate funds while the outcome indicator reveals the presence of corruption problems in the sector. The work process indicator suggests that justice administration in the country is hindered by a small budget especially from other charges (OC) allocated to the departments. * Characteristics of the Tanzanian Legal Sector: In general, the Tanzanian legal sector is characterized by the following defects: managerial problems; low competence at the lower levels and morale of public sector legal personnel; inadequate number of professionally trained legal personnel in some specialized areas; constrained independence and low integrity of the judicial system; ignorance and poverty of the majority of the citizens; and excessively limited and poorly maintained work environment for all public institutions in the legal sector. * Major Issues: Given the defects of the Tanzanian legal system, the main issues, which at present must be addressed are: (I) updating and harmonizing the legal and regulatory framework; (ii) strengthening the management and co-ordination of legal sector institutions; (iii) enhancing the competence and motivation of personnel in public legal institutions; (v) improving pre-service training and constantly upgrading legal skills of law officers in the public service to enable them cope up with new challenges in the market economy and a new liberal constitution regime; (vi) enhancing access to legal services for the poor and disadvantaged; (vii) developing and maintaining an enabling and conducive work environment for public legal officers. * In addition to addressing these problem, reforms in the legal sector must also aim at making the legal sector responsive to social, political, economic and technological transformation. * Major Problems: The major problems include: financial problem - the budgetary resource allocation to the MJCA has always been far too low to enable the ministry 153 perform its functions effectively; shortage of staff - this problem is very serious, especially in the AGC department; lack of training; low pay; poor state of office buildings, office equipment and office supplies; corruption; and shortage/poor library facilities. * Priorities: In order to realize the objectives of National Development Vision (Vision 2025) which aims at higher economic growth led mainly by the private sector, good governance, rule of the law, peace, stability, equity and the fight against corruption, there is need to address the following priorities: (i) the fundamental priority is to increase the funding of the MJCA (ii) to improve the work environment (iii) to improve remuneration, payment to court assessors, allowances and other approved benefits; (iv) to develop and implement strong in-service training programs (v) recruitment of more staff; (vi) to procure vehicles for supervision (vii) to establish and update the legal database and information systems; (viii) to rehabilitate and furnish and equip court buildings and offices; (ix) to improve pre-service training in the country; (x) to educate the masses about various legal aspects; and (xi) to strengthen the commercial court. * Projection for Future Budgets: The projection is based on the assumption that the MJCA which is currently included in the PER - Poverty Eradication will together with social service sector such as education, health and water, be identified as priority sectors, eligible for additional resources to be available through the HIPC initiatives and the TAS arrangement. It is assumed that the government will recognize the expanded role of the public Ministry of Justice, and will be prepared to increase resource allocation to the MJCA. It is assumed that the budget (in nominal terms) will increase by 25 percent. P13: AGRICULTURE SECTOR - MTEF Presentation - by the Permanent Secretary Ministry of Agriculture & Cooperatives * The Tanzanian economy depends on agriculture and therefore the sector's performance determines how the overall economy performs. The sector contributes about 50% of the GDP, providing about 75% of Tanzania's foreign exchange earnings. The sector also provides employment to about 80% of the population the majority of whom live in the rural areas. * The General Performance Trend of the Agricultural Sector: The performance of the sector has not been impressive in recent years in its role as an engine of growth, reduction of poverty and source of food security. The agricultural GDP has only grown at an average rate of 3.3 percent per annum since 1985. * Vision: On the basis of the National Vision 2025 for Food and Agriculture, the Ministry of Agriculture and Cooperatives (MAC), acting as a catalyst for agricultural and cooperative development, aspires to be: action oriented, professionally staffed and managed, dynamic, innovative and efficient, and provider of services that are demand driven, cost effective and environmentally friendly. 154 * Mission: The mission of MAC is thus to formulate sound policies, provide sound regulatory frameworks and support services as well as technical advice to farmers and to the private sector for a sustainable growth and poverty reduction. * Objectives: The MAC objectives in respect to agricultural development are as follows: (i) to review and formulate sound agricultural policies in order to ensure the right direction towards developing the sector; (ii) to provide support services to farmers and other institutions in order to improve technological know how which will facilitate increased agricultural production, productivity and quality; (iii) to provide the regulatory framework and services in order to sustain agricultural industrial growth; (iv) to provide technical services in agricultural farming in order to promote effective use of resources for sustainable agricultural development; (v) to develop human resources within the sector in order to increase the productivity of labor and to improve ability, awareness and morale; (vi) to provide assistance to co-operative development particularly in areas of human resource development and institutional capacity building without effect on their independence; and (vii) to provide the enabling environment for private sector participation in agricultural production, processing and marketing. * Policies: To achieve the stated goals and objectives, instruments employed include the following strategies: (i) to improve the agricultural extension and advisory services; (ii) to raise the efficiency and reduce the cost of production through use of appropriate technology; (iii) to regulate and control quality and standards of agricultural outputs and inputs; (iv) to coordinate agriculture and livestock research to generate appropriate technology; (v) to improve supervision and inspection of cooperatives (unions and societies); (vi) to institute cost sharing in research and training activities; (vii) to facilitate the cooperative movement through intensive and extensive member education on obligations and rights; and (viii) to train required manpower for their efficient and effective delivery of agricultural support services. * General Budgetary Performance: The share of MAC in the total government expenditure (both recurrent, development, and donor financed) has declined since the early 1990s. In 1990/91, MAC received about 5.1% of the expenditure. The share in 1991/92 and FY96 fluctuated in 3 and 4 percent. Between FY98, FY99 and FY00, the share was 2.1, 4.1 and 4.3 respectively. * Financial Resources to the Agricultural Sector: The agricultural sector is financed by the government, development partners (bilateral and multilateral), NGOs, retention schemes and contribution from crop commodity industries. The Ministry has launched a number of initiatives so as to increase funding in the agricultural sector particularly in areas of research and inputs. * Achievements against Objectives and Targets: (i) a new organizational structure based on the core functions is in place and functioning; (ii) rationalization of MAC and decentralization of extension services to the councils; (iii) privatization of parastatals under MAC for increased production is on-going; (iv) private sector development; (v) review and harmonization of the several acts and regulations has been completed; (vi) participating in TAS and HIPC initiatives; (vii) taking part in 155 preparing the Poverty Reduction Strategy Paper (PRSP); and (viii) several other programs/projects are under implementation. * Medium Term Expenditure Framework (FY01 - FY03): The medium term objectives for the sector based on the MTEF planning model are as follows: (i) to ensure basic food security for the nation and to improve national standards of nutrition and living in the rural areas through increased production growth rates of at least 4% and 4% and 5% per annum for food crops and livestock products respectively; (ii) to promote and encourage the production and export of agricultural and livestock produce to increase foreign exchange earnings and the supply of crops and livestock raw materials, their by-products and residues to the local industries; (iii) to develop human resources within the sector and introduce new technologies in order to increase the productivity of labor and land; (iv) to promote integrated and sustainable use and management of natural resources such as land, soil and water vegetation in order to conserve the environment; (v) to provide support services to the agricultural sector, which cannot be provided efficiently by the private sector. Policies and Strategies: * The sector's goal and policy objectives as contained in the agricultural and livestock policy and the Co-operative development policy of 1997 remain the pillars in redefining the roles of Ministry and the emerging private sector in the development of the agricultural sector in the country. The policy direction is based on economic reforms to increase the role for private sector participation in agriculture and the disengagement of the government form commercial activities and direct production function in the agriculture sector. * Currently, there are two categories of agricultural sector strategies. The strategies to implement the sector policies; and the strategies to implement the MAC Medium Term Strategic Plan 1999-2004. * Priorities: The following are priority areas and expenditure items for the MAC where public resources need to be invested: (i) strengthening policy formulation, analysis, review and monitoring of agriculture sector development; (ii) strengthen agricultural data on information system; (iii) the rehabilitation of research, extension and training facilities; (iv)enhance institutional reforms and capacity building in MAC; (v) complete and consolidate the on-going agricultural development projects; and (vi) support sustainable agricultural development activities. * Conclusion: The agriculture sector operates as an integral part of a large economic system. Hence a sound performance of the agricultural sector depends on the efficiency and effectiveness of the other sectors. The other sectors in turn require a strong agricultural sector for achieving social objectives. Thus, the linkages are very critical. P14: LAND SECTOR - MTEF Presentation - by the Permanent Secretary Ministry of Lands & Human Settlement 156 * Land is the ultimate resource, for without it, life on earth, as well as economic development cannot be sustained. Economic activities directly related to land resource utilization account for over 80% of Tanzania's GDP. The sector also provides more than 85% of national employment. Unfortunately, the majority of people in Tanzania hold land under customary or deemed rights of occupancy, whereby the security of tenure was until recently, not secured compared to the granted right of occupancy which was the preserve of the few. Rapid population increase compounded the problem of security of land tenure in urban areas and compounded conflicts in land use. Urban population now is estimated to account for 30% of the total population of Tanzania. * Problems: Among the many problems of land management experienced in rapidly urbanizing Tanzania are the following: shortage of planned land; massive growth of unplanned areas; lack of security of tenure for the majority of urban dwellers; problems of land administration to the extent of not knowing what is going on in the market; wide breach of land use regulations by developers and the inability of public authorities to enforce regulations, inadequate and uncoordinated land information; and emergence of parallel, unofficial and poorly understood and documented lands delivery system. * Ministerial Vision: To achieve efficient delivery of high quality land development services and a multipurpose cadastral information system for sustainable economic development and growth. * Challenges: Poor land administration and management; poor record keeping; demand for plots being greater than supply; delay in the issuance and registration of titles; inability to provide serviced land; unmanaged urban population growth in relation to town planning and in the provision of housing services; and slow speed in the provision of housing services in the rural areas. * Mission: The main mission of the Ministry of Lands and Human Settlements Development can thus be summarized as follows: to administer and manage land related issues (ownership, value, use etc.), to provide effective and efficient land delivery services; to administer and regulate cadastral surveys, hydrographic surveys, and mapping activities in the country; and to create enabling environment and institutional framework to support the human settlements development process. * Objectives: To facilitate realization of the mission of the Ministry of Lands and Human Settlements Development, the budget plan focuses over a period of three years with the following key set of objectives: excellency in service delivery; increasing revenue collection; and creation of an effective institutional and financial framework for the development of sustainable settlements. * Strategies: To publicize the Land Act No. 4 of 1999 and the Village Land Act No. 5 of 1999 and undertake special training; to have an effective land administration and management system; to establish an integrated and automated land information system; to establish a land register and data bank system; to improve the land delivery system; to issue and register titles promptly; to ensure that town planning is ahead of urban growth; to ensure that land use plans are adhered to; to embark on partnership 157 with urban dwellers to improve the management of towns and cities; to promote research and development in technologies for low cost housing construction; to promote the establishment of building finance societies; and to create a corruption free working environment. * Review of FY00 Performance: The operational objectives are: ensuring excellency in service delivery; promoting appropriate use of land resources so as to increase revenue by 31%; and the creation of an effective institutional and financial framework for the development of sustainable settlements. On all three fronts there have been tremendous achievements. The quality of land Management and service delivery has given hope for excellency. Revenue collection by end of February 2000 had increased by 12% compared to the same period of FY99 or had attained 75% of the FY00 estimated level. * Budget Estimates for year 2000/01: The ministry's budget estimates are based on the objectives, targets and related activities covering the period of three years (2000/1 to 2002/3). Proposed financial requirements are at Tshs. 936 billion over the next ten years. 10% of this amount is to be contributed by Government and the balance of 90% by donors and the private sector. According to the proposal, government needs to spend Tshs. 13.7 billion in the year 2001/02 and Tshs. 13.27 billion in 2002/03. other charges (OC), in addition to the payment of personnel emoluments (PE). * The Ministry realizes the constrains against obtaining the proposed expenditure allocations and therefore focuses on narrower but more realistic targets. Donor and private sector support to back up government financial projections and proposals is extremely vital. Such focusing has taken account of the following priority sequence: (i) components that are pre-conditions for operationalization of the new land laws; (ii) projects that facilitate basic planning across sectors; and (iii) projects that facilitate poverty reduction and promote sound economic management. Implementation of some of the components has already started. Discussion/Comments on P10, P11, P12, P13 and P14 * "Development means roads". If you can not connect the country you can not reduce poverty, improve social services, and you can not develop the economy. It is worrying to note that allocation for road maintenance is minimal and even the allocation to the sector as the whole does not reflect its priority. Rural roads are not given weight in the Roads MTEF. A paper on the rural roads is missing. There is a need of having a specific paper for the rural roads in the PER workshop. * Tanzania has very fertile land but imports food. The major problem is that of policy. There is a need to link agriculture with land. investment in agriculture does not receive the same weight as industry. There is a need to make leases on land irrevocable and change the relevant laws to facilitate the use of land as capital. It was also noted that the process of acquiring takes too long (3-4 years). This discourages both local and foreign investment in high scale agriculture. * Budget allocation to the agriculture sector should be proportional to its contribution to the economy. Removal of VAT on agricultural machinery is necessary for the 158 development of the sector. Also, free movement of food from one region to another, and from one country to another is important for the development of the sector. * Private sector involvement in the water sector should receive more weight. For the city of Dar es Salaam the provision of water could be subdivided to different private providers. * The Government is fighting corruption, but one has to note that fighting corruption needs a well functioning judiciary system. Also a well function judiciary system will encourage private investment in different areas of the economy; especially foreign direct investment. There is thus a need of paying more attention to the judiciary system in terms of resource allocation so that it can play the role it is supposed to play. * All our budgets are fire-fighting brigades waiting for fire to erupt. A more integrated budget where everybody gets a fair share of the cake is needed. There is a need to fit the shares to the three arms of the Government. Parliamentary allocations should be respected. We need to refocus future budgets to give more weight to development/production aspects and not only to consumption. For priority sectors, we better look at the unit cost and not the total amount. Summary of Major Emerging Issues HIV/AIDS epidemic: The HIV/AIDs epidemic is a serious multi-sectoral development problem in Tanzania. Fighting it requires that (i) the top political leadership puts HIV/AIDS on top of the national development agenda; (ii) top political leaders must take the lead by speaking about the severity of the problem and plead to the people, especially the youths, to change their sexual behavior; (iii) articulate a cohesive strategy on how to fight the epidemic including a medium term costing of priority actions to be taken from central to community level; (iv) establish a mechanism for cross-sectoral coordination; and (v) full scale mobilization of resources (local and foreign) just like in a liberation war situation. Translate macro-stability into improved welfare and reduced poverty: Tanzania has now largely achieved macroeconomic stability. However, there is a tension between good macroeconomic performance and translating this into a real improvement of welfare of the people at the micro level. The issue then is what it takes to move forward: (i) it is terribly important to maintain and sustain stable macroeconomic fundamentals enhanced by additional resource availability from HIPC and other debt relief initiatives; (ii) more investment (domestic and foreign) directed to agriculture, rural infrastructure and social service provision is key and a more effective development program is urgently required; and (iii) the private sector should be encouraged and enabled to take the lead. Need to re-examine the use of the cash budget system. The cash budget system has succeeded in reducing budget excesses, but this has been done at the expense of diminishing the authorizing role of the budget as approved by the parliament. In addition, the cash budget has severely reduced the service delivery capacity of the Government by making monthly resource availability unpredictable. There is thus a need 159 to set the limit of deviations of allocations through the cash budget vis-a-vis the approved allocations. Strengthening Accountability: The issue of accountability needs a further push to ensure that resources are better managed and accounted for. This entails increased follow-ups sanctions and prosecutions of those found to be involved in embezzlement and losses of public resources - something that will give donors confidence to channel their resources through budget. Improve Governance: Improvement in accountability calls good governance, which recognizes the role of opposition at the political front, and the role of other stakeholders on the country. Good governance also calls for recognition of the rule of law, and shuns political patronage and corrupt practices. Improve Revenue Collection and Tax Equity: Fiscal deficits have declined but mainly due to cuts in government expenditure rather than increases in revenue collection. There is need to increase revenue mobilization and to raise the tax effort in the long-run. Improvements in tax administration and further streamlining of the tax system should be a priority so as to broaden the tax base while at the same time reducing the burden on tax payers. Random raising of fees by government agencies is a concern that needs to be addressed since the practice may lead to tax evasion and discouragement of investment, especially in productive sectors. Enhance Transparency of the Budgeting Process: The nature and process of allocation of resources to various sectors is not transparent. Some priority sectors are allocated more than they require when allocation to others are stagnant or increase marginally - e.g. allocations to the road and agriculture sectors. Minimize Earmarking of Revenue: Earmarking of revenue creates problems in terms of coordination and prioritization and should be minimized. Improve Integration of Donor Resources in the Development Budget: Poor integration of donor resources into the Govt. budget is worrisome to the extent that it undermines the accountability and the credibility of the development budget. Donors need to ensure that their flows are captured in the budget. Government on her part needs to intensify the fight against corruption and increase further accountability and transparency. Efficient Implementation of the Public Sector Reform Program is Crucial: There is concern that civil service reforms are not encompassing enough and too slow. In particular, staff reductions are too limited to create sufficient savings for effective salary increases without crowding out other expenditures. PSRP needs to be well integrated with other reforms and should pay more attention to the gender dimension and create equal opportunities for women to participate and accede to higher levels of the civil service. Fiscal Deficit Policy: There is a need to consider whether a balanced budget (or surplus budget) is beneficial to the economy: Given the level of expenditure that is currently 160 supported by the economy and the low level of domestic demand, there may be a need for a small deficit. However, there are worrying issues - i.e. , whether foreign reserves can support this deficit if resources from external sources (donors) are not forthcoming in the magnitudes expected; and whether contingent allocation will not generate further surpluses. Move from project to budget support: Improvements in financial management and accountability should enable donors to employ increasingly aid modalities such as basket funding, sector development programs, and general budget support and limit the number of discrete projects. Prioritization is still a problem in some sectors, i.e., the identification of absolute or key priorities that will make a difference in terms of improving performance indicators. The translation of objectives and priorities into expenditures in consistency with the overall resource envelope is still a problem in some sectors. Broaden Participation in PER Macro and Sectoral Working Groups: Even though the private sector is represented in PER Working Group, its participation needs to be extended into the Macro-Working group that is responsible for drawing the budget frame and the underlying assumptions. Enhanced participation in sector working groups by interested stakeholders is desirable. Support Private Sector Development for Economic Growth: Private sector development requires Government attention and support through the creation of an enabling environment for the participation of the private sector in the economy, including appropriate regulation. Private sector contributions in the social sectors need to be given more attention. Enhance Funding for Road Maintenance: Resources from the Road Fund are greatly insufficient for adequate road maintenance. It is thus imperative to consider options for providing additional resources for road maintenance, e.g., through the provision of funds from the general budget or through a shift of donor funds from road development to road maintenance. No improvement in Education: Despite the fact that a lot of resources have been injected into education there is no noticeable improvement. This highlights the point that with enhanced resource availability from various sources for the priority sectors, there is also an urgent need to improve monitoring of service delivery to ensure that additional resources are used to improve outcomes. Link sector MTEFs with TAS: There is need to link the sectoral MTEFs with the TAS document and other initiatives. 161 List of Participants No. NAME | TITLE/OFFICE A. GOVERNMENT 1. Mr. Peter Ngumbullu P. Secretary - Ministry of Finance 2. Mr. Peter B. Barie Permanent Secretary - Min. of Agriculture Culture 3. Ms. Janet Bitegeko Ministry of Agriculture & Cooperatives 4. Mr. Bedason A. Shallanda Ministry of Finance 5. Mr. Gray Mgonja Ministry of Finance 6. Mr. Jerome J. Buretta Ministry of Finance 7. Mr. Peniel Lyimo Ministry of Finance 8. Mr. Prosper J. Mbena Ministry of Finance 9. Ms. Elipina Mlaki Ministry of Finance 10. Mr. Likolo Ndalamei Ministry of Finance, Zambia 11. Mr. Daud M. Msangi Ministry of Finance 12. Mr. E. Mwaipaja Ministry of Finance 13. Mr. H.S. Makundi Ministry of MNRT 14. Mr. Frans Ronsholt Ministry of Finance 15. Mr. Raphael Mollel Permanent Secretary, Prime Minister's Office 16. Dr. Enos S. Bukuku Prime Minister's Office 17. Mr. A. R. M. S. Rajab Permanent Secretary - Vice President's Office 18. Prof. Hamphrey P. B. Moshi Ministry of Finance 19. Ms. Joyce Mapunjo Ag. Commissioner - Treasury 20, Ms. Salome 1. Sijaona Permanent Secretary - MRALG 21. Mr. Alfred L. P. Kabagire MRALG 22. Mr. Richard Mkumbo Ministry of Health 23. Ms. Mariam J. Mwaffisi Ministry of Health 24. Mr. Laston T. Msongole Planning Commission 25. Ms. Mwantumu Malale Permanent Secretary -Community Development, Women & Children 26. Mr. Ngeli Kilangwa Prime Minister's Office 27. Mr. Basil Kaunga Prime Minister's Office 28. Mr. Iziraiah Mukaruka Vice President's Office 29. Mr. R.A. Moshy Ag. Permanent Secretary, Min. Energy & Minerals 30. Mr. S. Odunga Permanent Secretary - Ministry of Works 31. Mr. Gilbert J. Kinvero Ministry of Works 32. Mr. V. Katabwa Ministry of Works 33. Mr. S.H. Mwiru Ministry of Science Technology & Higher Education 34. Ms. Catherine Joseph Ministry of Agriculture & Cooperatives 35. Mr. E. E. Maimu Civil Service Department 36. Mr. George D. Yambesi Civil Service Department 37. Mr. J Rugumyamheto Civil Service Department 38. Mr. William Kleiman Civil Service Department 39. Mr. Amantius Msole Tanzania Revenue Authority 40. Mr. M.G. Kamugisha Tanzania Revenue Authority 41. Mr. B. Luanda Judiciary 42. Mr. M. Abisai Judiciary 43. Mr. B.A. Mahiza Planning Commission 44. Mr. Aloysius G.T. Nyenza Ministry of Water 45. Mr. G. Nilsen Ministry Works 46. Mr. Ahmad Mbegu Ministry of Science Tech & Higher Education 47. Mr. A. S. Ndeki Commissioner for Education - MOEC 162 48. Mr. D. M. S. Mmari Permanent Secretary - Ministry of Lands 49. Mr. G. Saelie Ministry of Water 50. Mrs. D. R. Makani Ministry of Justice & Constitutional Affairs 51. Mr. John C. Millinga Ministry of Justice & Constitutional Affairs 52. Mr. Kulwa S. Massaba Ministry of Justice & Constitutional Affairs 53. Mr. Seith J. Makundi Ministry of Lands 54. Mr. Benard S. Mchomvu Permanent Secretary, Home Affairs 55. Mr. F.E. Mbonde MRALG 56. Mr. A. N. M. Idama Ministry of Education & Culture B. PARASTATAL/NGOs 57. Mrs. C. Kiliaki Bank of Tanzania 58. Mr. Charles M. Chenza Bank of Tanzania 59. Mr. Ali A. Mfuruki Infotech Computers Ltd. 60. Dr. Brian Cooksey TADGREG 61. Mr. Arnold B. S, Kilewo Private Sector Foundation 62. Dr. Servacius B. Likwelile REPOA 63. Dr. Haji Semboja ESRF 64. Mr. Malik Jaffer Aga Khan Foundation 65. Mr. A.E. Musiba TCCIA 66. Mr. LS. Hatibu Bakwata 67. Ms. Joan A. Nkya Christian Social Services Comission 68. Mr. N. Gotecha CTI 69. Mr. Salum Shamte Tanzania Chamber of Agriculture & Livestock 70. Prof. Samuel M. Wangwe Economic & Social Research Foundation 64. Mr. Dunstan Mrutu Tanzania Private Sector Foundation C. MEMBERS OF PARLIAMENT 71. Hon. Dr. Omari S. Kizango Member of Parliament 72. Hon. Makidara Mosi Member of Parliament 73. Hon. Y.K. Mahmoud Member of Parliament 74. Hon. W. H. Shellukindo Member of Parliament 75. Hon. J.W. Chevo Member of Parliament 76. Hon. Gerald J. Ngotolainyo Member of Parliament 77. Hon. J.C. Semwaiko Member of Parliament 78. Hon. Aripa Marealle Member of Parliament 79. Ms. Phoebe 0. Mmbaga Parliament of Tanzania 74. Hon. Philip A. Magani Member of Parliament D. DONORS 80. Ms. Riikka Laatu Counsellor - Embassy of Finland 81. Ritra Jolkkonen Ambassador - Embassy of Finland 82. Mr. Patrick E. Doaaghty ELO 83. Mr. Van Banning Netherlands Embassy 84. Mr. William Mitchelle Canadian High Commission 85. Ms. Rose A. Mushi CIDA 86. Ms. Arne Olsen Norwegian Embassy 87. Mr. Peter Beck Christiansen European Commission 88. Mr. Alex Baum EU Delegation 89. Ms.Valerie Leach UNDAF Adviser 90. Mr. Udo Etukudo UNDP 91. Ms. Dorothy Nsherenguzi SDC 92. Ms. Theresia Genda SDC 163 93. Mr. Olivier Burki SDC 94. Mr. Ephrem Kirenga SDC 95. Mr. Antoine Heudre Embassy of France 96. Mr. Sten Rylander Swedish Embassy - SIDA 97. Ms. Karsten Lund Jorgensen Danish Embassy 98. Mr. Oddvarjokobsen UNDP 99. Mr. Alessandro Falchetto Embassy of Italy 100. Leutenegger Jean-Jacques Embassy of Switzerland 101. Mr. Teferi Seyoum UNFPA 102. Mr. Frans van Rijn Embassy of Netherlands 103. Mr. Zoya Potapora Russian Embassy 104. Mr. Richard K. Ndaskoi SDC 105. Mr. Mitsuaki Furukawa JICA 106. Mr. Jackson Biswaro JICA 107. Dr. Rolf Drescher German Embassy 108. Dr. Christine McNab Swedish Embassy 109. Mr. Gilbert Kajuna USAID 110. Mr. Ronan Corvin Embassy Ireland Ill. Mr. Masashi Kono Embassy of Japan 112. Mr. T. Lindqvist Danish Embassy 113. Mr. Gunnar Foreland Norway Embassy 114. Mr. Heuts Philip Belgian Embassy 115. Mr. Nicklaus Zingg Counsellor (Dev) Embassy of Switzerland 116. Mr. M. Stein Olson USAID 117. Mr. Stafford Baker USAID - Ag. Director 118. Ms. Charlotta Norrby Economist - Embassy of Sweden 119. Mr. Peter L. Hansen Ambassador - Denmark 120. Ms. Rebekka van Roemburg Royal Netherlands of Embassy 121. Ms. Amina A. Ali Ireland Aid 122. Ms. Fiona Shera DFID 123. Mr. John P. Snell Deputy Representative, FAO 124. Dr. Jorgen Levin Gothernburg University, Sweden 125. Mr. Steven Lee Economic Adviser - DFID 126. Mr. G.G. Johnson IMF 127. Mr. H. Hirschhofer IMF 128. Mr, Tsidi M. Tsikata IMF 129. Mr. Peter Mwanakatwe African Development Bank 130. Mr. James Adams World Bank 131. Prof. Benno Ndulu World Bank 132. Dr. Ben Tarimo World Bank 133. Dr. Philip Mpango World Bank 134. Dr. Emmanuel Malangalila World Bank 135. Dr. Rest Lasway World Bank 136. Mr. Emmnanuel Mungunasi World Bank 137. Mr. Vedasto Rwechungura World Bank 138. Mr. Donald Hamilton World Bank 139. Mr. George M. Kabelwa World Bank 140. Dr. Hamisi H. Mwinvimvua World Bank 141. Dr. Robert Utz World Bank 142. Dr. Mushiba Nyamazana World Bank - Zambia E. ACADEMIC 143. Prof. Anselm Lwoga Sokomie University of Agriculture - Morogoro 164 144. Prof. L. Luhanga Vice Chancellor- University of Dares Salaam 145. Prof. G. Mmari Vice Chancellor - Open University of Tanzania 146. Prof. Nehemiah E. Osoro University of Dar es Salaam 147. Prof. Robert Mabele University of Dar es Salaam (ERB) 148. Mr. P. Mwanakatwe African Development Bank 149. Mr. David Bevan Oxford University F. MEDIA 150. Mr. Ongeni John Habari 151. Ms. Koiya Kibanga DTV 152. Mr. Christopher Mfinanga DTV 153. Mr. Fumbuka Ng'wanakilala The Guardian 154. Mr. Gervas J.Luganda The Democrat 155. Mr. Saidi Msonda The guardian 156. Mr. Nicholaus Mbaga TVT 157. Mr. Masoud Nassor Masoud Business Times 158. Mr. Abduel Elinaza Busines Times 159. Mr. A.O. Kombo CEN.TV 160. Mr. Freddy Maro Daily News 161. Ms. Agatha Mshanga TVT 162. Mr. Assah Mwambene Daily News 163. Mr. Hussein Iddi CTN 164. Mr. Kuringe Mongi CTN 165. Mr. Perege Gumbo Financial Times/Guardian 166. Mr. Safina Mohamed Maelezo 167. Mr. Willy Kitima Business Times 168. Mr. David Luninze BBC World Service 169. Mr. B. Lugwishe The African 170. Mr. Joseph Bendu The Democrat 171. Ms. Premy Kibanga The East African 165 ANNEX 2: DATA 166 Table I Tanzania Key Indicators S/N Indicator Unit 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000* I Population/2 Milions 24.6 25.3 26.0 26.7 27.5 28.3 29.1 30.0 30.9 31.9 33,0 o/w Mainland/2 Millions 23.9 24,6 25.3 26.0 26.7 27.5 28.3 29,1 30,0 30.9 31.9 2 GOP Grow(hfW % 6.2 2.6 1.8 0.4 1.4 3.6 4.2 3,3 4.0 4.5 5.0 3 Intlation/2 % 35.6 28.7 21.8 24-0 33.5 27.4 21.0 161 12.9 7,8 6.0 4 Exchange Rate/2 TZSIUS$ 197.6 222.5 301.9 414.5 509.6 574.8 580.0 624.8 654.7 720.0 800.0 5 Exports/2 Mil. US$ 336.9 342.9 410.6 437.0 519.4 682.9 763.8 752.0 588.5 540.9 650.0 $ lmports/2 Mit US$ 1170.5 1219.1 1300.6 1282.8 1309,3 1340.5 1212.6 1148.0 1366.0 1418.6 1350.0 7 Current Account Balance12 Mil. US$ -558.9 -736.1 -800.1 -1022.0 -711,0 -6464 -461.3 -555.1 -946.6 -861.9 -784.8 8 Balance of Payments/2 Mil. US$ -200.0 -260.0 -228.1 -634.4 -401 3 -386.0 -245.0 -556.0 -615.7 -411.3 -274.8 9 Average Deposit Rate/2 % 26.0 26.0 26.0 24.0 250 21.0 16.7 10.0 9.0 8.0 9.0 10 Average Lending Rate/2 6 26.0 26.0 30.0 30.0 31,5 35.5 33.5 26.5 24.0 20.0 20.0 11 Growth in Money Supply (M3)/2 % 43.3 26.9 42.7 39.3 35.5 32.2 8.7 133 10.8 8.0 12.0 12 Foreign Reserves/2 Mil. us$ 238.9 301.2 458.5 271.9 431.8 288.5 500.6 638.7 689.0 690.0 700.0 13 External Debt/2 Bit US$/1 5.6 6.0 5.9 7.5 8.0 8.4 7.8 8.0 7.8 7.5 7.3 14 Total Domestic Revenuell Bil. TZ3 94.7 137.1 173.6 164,1 242.4 331.2 448.4 572.0 627.5 689.3 810.3 15 Tax Revenue/1 oil. TZG 81.5 118.3 153.4 146.4 220.4 299.9 383.7 505.4 586.2 616.3 728.7 16 Non-Tax Revenue/1 Bit. TZS 13.2 18.8 20.2 17.7 22.1 31.3 64.6 66.7 41.3 73.0 61.6 17, Total Expenditure/1 Bit. TZS 127.9 201.2 223.8 337.9 410.5 453.4 5001 730.9 856.2 27.7 1180.7 18 Recurrent Expenditurell Bit. TZS 111.6 163.0 191,2 273.2 335.8 386.6 470.0 606.3 669.6 791.2 933.8 19 Development Expenditure/1 Bil, TZS 16.3 38.2 32.6 64.7 74.7 66.8 30.1 124.6 186.6 136.5 246.9 20 Grants/1 Bil. TZS 27.7 22.9 32.8 58.3 76.9 67.3 46.9 1154 119.4 169.9 235.6 21 Fiscal Balancell Bit TZS -33.2 -64.1 -50.2 -173.8 -168.1 -122.2 -51.7 -158,8 -228.7 -238.4 -370.4 22 Foreign Direct investment/2 Mil. US$ 0.0 0.0 12.0 20.0 50.2 150.9 148.6 154.6 172.2 183.8 196.2 23 Tourism Earnings/2 Mil. US$ 65.0 94.7 120,0 146.8 192.1 258.1 322.0 392.4 570.0 733.3 943.4 24 Gross Domestic Savings/2 Bil. TZS 78 6 114.1 131.3 46.7 -3.6 75.4 271.0 328.2 360.0 390.0 422.5 25 Gross Investrments/2 Bit. TZS 214.0 282.4 369.4 429.6 561,8 591,9 620.6 692.4 827.1 880.0 936.3 '26 Per capita l"come/2 US$ 160.9 1807 167.0 149.2 1568.2 176.9 210.3 235.6 257.0 270.0 283.6 Notes: 11 Fiscal Year is used, and it ends on June 30th of the mentioned year, 12 Calendar year is used, and it ends on December 31th, * If calendar year, data are projections and if fiscal year, data are estimates. Average Deposit rates: Annual average rate on six months deposit Average Lending rates: Annual average rate on short term loans Exports: Merchandise Exports imports: Merchandise Imports Gross Investments: Gross fixed capital formation Sources; The Planning Commission, The United Republic of Tanzania, Economic Survey, various issues. Bureau of Statistics, Planning Commission, National Accounts of Tanzania, various issues. The Bank of Tanzania. Economic Bulletin, various issues. The Bank of Tanzania, Economic and Operations Report, various issues 167 Table 2: Salance of Payments (in Milions o1 US dollrs) Items 1S0 19911 1992 1393 1934 19351 ist 1997 198 1935 Current Account -53.0 -73.1 -708.1 -1022.0 .711.1 -G46.4 .461.3 -558.1 44.6 -862.0 Goods -778.5 .8653 .919.6 -835.6 -7900 .657.6 -448.9 -395.4 -777.5 -877.7 Exports (fob) 407.8 362.3 397.0 439.3 5194 6829 763.8 752.6 568.5 540-9 Imports (faob) 1186.3 1227.6 1316.6 1274.9 1309.3 1340.5 12126 1148.0 1366.0 14186 ServOes -157 2 .157.5 -169.1 -3899 -85.1 -216.9 -278.8 .306.4 -452.6 -225.0 Receipts 130.6 142 1 167.5 3108 4182 582.9 537.1 493.8 537.0 640.9 Payments 287 8 299,6 336.6 700.7 503.3 799.8 815.9 800.2 989.6 865.9 Income -185.0 -1842 -2254 -1475 -122.5 .110.3 -72.0 .1228 -124.2 -752 Receipts 5.9 79 a.1 21.4 309 31.1 41 5 44.9 46.3 56.0 Payments 190.9 192 1 233.5 1690 153,4 142.1 113.5 167.7 1725 131.2 Current transfers Sr1.7 4709 606.0 351.1 286.5 3384 338.4 269.6 407.7 3159 Inflows 5927 503.5 641.0 381.1 311.5 370.7 370.7 3372 4481 439.2 Government 538. 480.3 5062 3709 2150 2360 2360 238.8 279.5 305.2 Prvate 54.3 232 1348 10.2 96.5 134.7 1347 984 1686 134.0 Outflows 31.0 326 350 30.0 25.0 32.3 32.3 677 404 123.3 CapitalAccount 327.2 353.1 298.2 200.6 262.6 191.0 191.0 166.9 276.0 303.1 Caprtal transfers 3272 353.1 2982 200.6 262.6 191.0 191.0 1669 276.0 303.1 Intlows 3272 353 1 298 2 2006 2626 191.0 1910 165.9 275.0 3031 Outflows 00 0 0 0.0 0.0 00 0.0 0.0 00 0.0 00 Acqusitnldrsposals of nn-produced C 0 0 C 0.0 00 0.0 0.0 0.0 00 0.0 0.0 non-fiancial asses Financial Account 42.3 117.9 107.3 97.0 -106.8 138.6 0.3 -136.4 97.0 225.2 Direct investment 0 C 00 120 23 C 50.0 150.0 1485 157 8 1722 1834 Abroad 00 00 00 0.0 00 00 0.0 00 0.0 00 In Tanzania 00 CC 12.0 200 500 150.0 148.5 157.8 1722 1834 Pnlosrri vestnent 0 0 0 O0 0 00 0.0 00 00 00 0.0 00 Other investment 42.3 117 9 953 37.0 569 -105 -1482 -2942 -75.2 41 8 Infiow of fiancrial resources 236.9 271 0 331.9 6154 434.5 437.4 316.6 4168 438.0 4799 Disbursement of Govemment loans 2235 260.5 267.5 372.4 274.2 244 1 224.9 269.8 239.2 319 6 Traderedtind other financial flows 134 105 64.4 1432 122 1 141 77.0 1194 134.9 784 Disbursement of loans t other sectors 0 0 0.0 0 0 99 8 38.2 51 4 16.7 23.0 63.9 78 5 Outow of financial resources 194 9 153 1 236,6 5784 591.3 447.9 4667 711.0 513.2 438.2 Repa3yment govemmentloans 168.9 1457 23 6 4981 491.3 272.5 361.6 757.6 593.1 447.0 Trade creditdanother financial flows 25.8 74 00 684 756 162.6 43 1 -107.5 -1364 -55.8 Repayment of loans by otrer sectors 0.0 00 00 11.9 24.4 128 61.8 52.8 47.4 505 Errors and omissions 478 33.1 -105.3 27.6 94.0 -70.1 25.0 -31.5 .42 1 .77.7 Overall Balance -141.6 -232.1 -4D7.9 -736.7 -461.3 -386.0 -245.0 -55.1 -415.7 -411.3 rinancIng 141.6 232.1 407.9 736.7 461.3 396.0 245.0 556.1 615.7 411.3 Net Reserve assets (- increase) -1397 -853 -2535 157.3 -770 60 1 -165.3 -84 4 -11 1 .121 4 LCFAR 0.0 0.0 0.0 0.1 0 0.0 0 0 0.1 -0 1 0 0 Excepronal financing 251 4 317 4 506.1 5793 538 3259 4103 640.4 626.9 5327 Arrears 1002 344.7 206.7 1990 294 4 2694 3122 1309 130.9 1164 Rescheduling 1558 00 1387 136.6 144 5 00 00 1592 1753 116.2 Debtforgrveness 110 0.0 26.0 235 236 00 0.0 1940 151.4 1159 Use or Fund credit 144 -27.3 1357 70.4 0c 00 00 00 0.2 0.1 Grants/borrowing for BOP purposes . - * 1498 736 65 99.1 156.3 1691 184 1 Financinggap - - - 00 00 00 00 00 00 00 Memorandum items: GDP(mp)MiN.TZS 1,607.762.00 2.125,325.00 2,796.640.00 3,452,580.00 4.281.600.00 5.047,669.76 6,281,576.00 GDP(mp) Min. USO 3443.6 37681 4.04221 3,967.14 4,170.36 4,665.74 5952 91 6,99467 7,594.43 8,450.50 CABSOP -16.2 .195 -174 -25 . .17.1 -13.3 -7.7 -7.9 -12.5 -10.2 CABIGDP (excl. current official transfers) -31.9 -323 -300 -351 -22.2 .181 -117 -11.4 -161 -13.8 Gross Omesat Reserves 19 242 1 394 3 228.3 331 3 270.0 441.1 623.1 5990 775.6 Weeks of imports S 8.2 12.1 60 95 66 11.3 -16.6 -132 -177 * ProVIssonal Source Balance of Payments Department of the Bank ofTanzanra, 168 Tebl3 : SUMMARY OFCENTRAL GOVERNMENTOPERATIONS (0>inIlaas ofTanoania shinings) FYS FY7 FY" l FYes FY90 i FY$2 FY92 FY93 FY94 FY95 FYSS FY97 FY311 FYn FYOQ foevenue 20,831.9 31,098.0 46,43100 71,790.00 94,655.00 131,238,00 173,56Q.00 1h4,110.00 242,444.00 331,240.00 445,373.00 572,030.00 619.083.00 649,325,00 777.644.30 Tayreve~ue 19,6810 29,1B400 42,5700 63.C500 B1,47100 118,25700 153,3500) 146,42000 292.356.00 299,90000 3a3.7400 50 5.00 566,122.00 616,244,00 65.107.00 Ne.ax tevnne ,170600 1.914.00 3.074.00 8,10500 13.184.00 14.981.00 20,210.00 17.690.OD 22,086.00 31,340.00 64,62900 56,67500 52.901.00 73,041.00 92.6537.20 o&pend,hne and Ne.Lnding 32,37300 47.44500 13,368.00 93,994.0M 126,2420O 151,86300 194,89100 305,059.00 370.91000 395,6W/0M 420.52200 515,09900 730,336.00 819,335.40 1,168.778.79 Rev.rentependitwue 26,912.00 35.14600 51.896,00 78,119.00 103,66600 135,37500 162,260O0 240,34900 296.22100 345,91590 415,14000 496,3,00 543,751,00 642,812A0 06,865A4 Dt~pM ekexend"tle and 6,461.00 12,299.00 21,472,00 15975.00 22.37600 16.486.00 32,605.00 64,710.0r 74,690% 49692.00 5,3B2.00 2t0.595 18055.00 13524.00 0359913.39 p rt of net lending <oeraualanc~ehecksissued) (11,5420) (16,341.0 (26,937 00) (22,204.0) (31,58705) (14,62500) (21,32500) (140,94900) (128,46600) (64.36700) 27,95100 5D,93.09 {f11,253.00) (430,01.40) (39(1134,49) AdJumeInto cash and other50 3,205.00 (2,936,00> (2,982.00) (3.640.00) (4,129500 (0750 00) (l,070.00) 6,625.00 (36J753,00) 59,9490 92,445,09 (36,512009 60,033.00 (52,041.D0 (54,6558,00 tver, i.ace(checks-cleated) (B.33700) (18,38300) (29,91(9 (25,852 00 (35,7160C) (27,37/500 (23,1500) (134,32 00) (165.21900) (13,718 00 120,33b.00 20,419.00 (51,220.00 (182,052.4 (445,9249) 0verallbala1c(anergran1) (4,94600) (1I028.00) (1,249.00) (3.923,00) 4,251,00 11.47100 >82,636O) (5t.557 00) 41,22500 74.330 13B470 w 8.10S.00 39,934.60 1296,947A9) 8,33700 18,38400 29,919,0O 25,85200 353199n 2T,3750 23.195 M 134,32100 165,2195O 125,736.00 64,63400 (20.419.00 187,496.00 179,422,0 153,204.00 q<g,ns - 11,40t00 15,909.00 20,9500 27,664.00 22,8700 32,796.0 58,313.00 76,909,00 105,552.0 46.e8200 81.416.00 119,358,00 169,94600 64,187.015 F0oig n4fintn.e -tn 2,222 00 2.40100 7,31800 (3,24500) 1.48900 8,8500 22676.03 29.43600 47,75400 (37,956 00 (34.9900 00 (49.065.00 64,4680 (15,684.00) 78,017.00 Do 1m0Brrowing 6,11500 4,58200 f 62.990 ,112.00 6,563 QO (4,35900) (32.27700) 46,57200 40,656.00 58,10100 52,65200 (52.770.00 3,670.00 28,160.00 (19.00.00 Tol.i Rev,nue 16,0 103 99 12 3 125 135 136 102 114 11.. 130 134 13.1 12.3 12.4 Ta xevenue 16.1 9.6 9.1 190 10.7 120 120 9,t 104 10.7 i 1 11.8 120 127 10,9 Nonrim.eV. 09 0.6 0.8 15 17 15 16 1.1 10 1.1 19 16 0.1 1.4 1.5 TolSTtxpend,e end Netteondng 24,8 15.7 15.7 16.1 166 15.3 15.3 190 17.5 14.1 122 120 15.5 16.2 18,S Recurrentependiture 207 11.9 11.1 134 137 137 127 149 43,9 124 12,0 114 11.5 12,7 12.6 D.eeopment expendhtu. and 4.2 4 1 4.6 27 29 1 7 2,5 4.0 35 18 02 05. 4.0 2. 5-.7 øart or bet lenthnø Oeat barance (checks Issued) -89 -54 -5.8 -38 -42 -19 -1 7 -8,8 -5.0 -2.3 08 1.3 -2,4 -2.2 -8.2 Adjuskeenotcashandffief 25 -07 -0. -06 .05 -0.9 -01 0,4 -1.7 1,B 2.7 ..9 1,3 -s2 -0.9 tms5(net) 00 0,0 0.0 0.0 0.0 00 0 D0 00 0 0 G.G 0,0 0,0 0ß 13veraf 0stanc(6heck..cleared) -64 4.1 -64 -4.4 .47 -2.8 -18 ~B.4 7.6 -0.5 35 0.5 -Oo -3 -7,1 veran baance(altergalns) .. -16 -24 -02 -05 04 09 ·5.1 -2.4 1.5 22 3,2 0.2 1,0 -47 6.4 6.1 6.4 44 47 25 1.8 3.4 7.8 4.5 19 .0.5 4-0 2.4 2,4 External gr,an .. 3.8 34 3.6 3,6 23 26 3,6 3.6 38 1A 1,9 2.5 3.2 1, Foreig" Finaficing, net M 1,7 0.8 19 -06 0.2 0 1.8 1 2.2 -14 -1.0 -1,1 1-05 1,2 Domestc Øofrowing 4.7 1.5 1.4 1.4 0,9 -0,4 2.5 2.9 1.9 21 5 -12 0.1 -0.3 -0.3 Memo item. GDPat malkelpriceS(Iscalya rs5) 130,30200 302.68000 466.40000 525.133.00 671,09550 874,79950 1,132,755 5 1,441.840 00 1,866,54350 2,460.983.00 3.124,600,00 3,467,790 4.710,741,75 5,626,622.25 6,281,474,60 1/ )ncludes rareign grants prwr to FY87 CompW.ons 0f pfecentages for FYg8, FYG9 and FYD0 31e based on GDP est,mates f.r the respecive year S.Umce. The Tanxa.lan aulhories 169 Table 4a: Budget Frame For 1999/2000 - 2002/03 (Accounting) 1999/2000 1999/2000 2000/01 2001/02 2002/2003 REV.EST Likely Outturn Proj. __ Proj.- Proj. . Total Resources _ 1,168,343.00 1,399,811.66 1,523,809.22 1,512,605.60 Domestic revenue -777,200.0 881,953.00 993,923.0 1,120,707.00 Import sipporv/OGL 173.700,0( 164,841.2( 162,280.13 156,018.18 Project loans and grants 214,943.0 275,475.5( 296,737.97 159,389.53 fHIPC interim relief-Multilateral 10,500.0 46,061.6C 53,893.7, - 59,007.26 HIPC interim relief-Paris Club - 16,480.0( 16,974.4( 17,483.63 Non Bank Borrowing Bank Borrowing _ __(8,000.00) - Adjustment to cash (0.0 0.( 0.( Privatisation Funds 15,000.3C 11. Total Expenditure 1,168,343.00 1,399,811.66 1,523,809.22 1,512,605.60 Recurrent Expenditure 930,000.00 1,061,836.10 1,150,313.25 1,274,521.82 CFS 253,562.00 279,662.0( 265,600.0 285,800.00 Debt service 198,100.00 221,200.0 202,100.0 218,300.00 interest 106,500.00 124,500.0( 103,000.0( 119,200.00 amortization 91,600.00 96,700.0( 99,100.0( 99,100.0 Others 55,462.00 58,462.00 63,500.0( 67,500.0 Recurrent Exp.(excl. CFS) 660,038.00 774,884.1( 884,713.2 988,721.8 o/w Salaries & wages 287,287.20 _ 315,850.6 __356,812.7 396,504.5 Other Charges - 168,156.80 218,189.4- 273,641.9 332,146.0 Designated Items* 190,794.00 208,644.0- 214,258.5 260,071.1 Payment of Arrears 16,400.0 7,290.0( Contigency 17,0000 21,758.0 23,694.2 Development Expenditure_ 238,343.00 320,975.56 351,737.9 214,389.53 Projects 238,343.00 320,975.5 351,737.9 214,389.53 Local - 23,400.00 36,000.01( 45,000.0 45,000.0 Songo songo energy Fund 9,500.0 10,000.0 10,000.00 Foreign -_ _ _ _________214,943.00 275,475.56 296,737.9 159,389.53 Other Programme Assistance __ _ Includes Special Expenditure, Road Fund, Parastatal Wages, TRA and Retention Schenne * Starting 1998/99, Electricity Bill is included in the Special Expenditure 170 Table 4b: Budget Frame For 199912000 - 2002103 (Accounting) As % of GDP 199912000 1 200012001 200112002 200212003 Likely Proj. Proj. Proj. Outturn I. Total Resources 18.6 20.0 19.6 17.5 Domestic revenue 12.4 12.6 12.8 13.0 Import support/OGL 2.8 2.4 2.1 1.8 Project loan and grants 3.4 3.9 3.8 1.8 HIPC interim relief-Multilateral 0.2 0.7 0.7 0.7 HIPC interim relief-Paris Club 0.0 0.2 0.2 0.2 Non Bank Borrowing 0.0 0.0 0.0 0.0 Bank Borrowing -0.1 0.0 0.0 0.0 Adjustment to cash 0.0 0.0 0.0 0.0 Privatisation Funds 0.0 0.2 0.0 0.0 II. Total Expenditure 18.6 20.0 19.6 17.5 Recurrent Expenditure 14.8 15.2 14.8 14.8 CFS 4.0 4.0 3.4 3.3 Debt service 3.2 3.2 2.6 2.5 interest 1.7 1.8 1.3 1.4 amortization 1.5 1.4 1.3 1.1 Others 0.9 0.8 0.8 0.8 Recurrent Exp.(excl CFS) 10.5 11.1 11.4 11.5 o/w Salaries & wages 4.6 4.5 4.6 4.6 Other Charges 2.7 3.1 3.5 3.9 Designated Items 3.0 3.0 2.8 3.0 Payment of Arrears 0.3 0.1 0.0 0.0 Contigency 0.0 0.2 0.3 0.3 Development Expenditure 3.8 4.6 4.5 2.5 Projects 3.8 4.6 4.5 2.5 Local 0.4 0.5 0.6 0.5 Songo songo energy Fund 0.0 0.1 0.1 0.1 Foreign 3.4 3.9 3.8 1.8 Other Programme Assistance 0.0 0.0 0.0 0.0 171 Table Sa: Budget Frame For 199912000 - 2002103 (Analytical) mill. shs. 199912000 200012001 2001/2002 2002/2003 Likely Outturn Ceilings Proj. Proj. Domestic revenue 777,200.00 881.953.00 993,923.00 1,120,707.00 O/W Road Toll 40,475.73 41.337.17 43,554.65 45,114.93 Retention Fund Total Expenditure 1,060.343.00 985,183.10 1.089,239.00 1,212,937.75 Recurrent expenditure 822,000.00 939,683.10 1,039,239.00 1,162,937.75 Interest on external debt 36,500.00 67,500.00 46,000.00 62,200.00 Interest on domestic debt 70,000.00 57,000.00 57,000.00 57,000.00 Wages/salaries 287,287.20 315,850.60 356,812.75 396,504.59 Goodslservices/transfers 428,212.80 499,332.50 579,426.25 647.233.16 olw Road Fund 40,475.73 41,337.17 43,554.65 45,114.93 Special exp. 117,818-27 114,517.18 130,480.96 170,868.66 CFS (Others) 55,462.00 58,462.00 63,500.00 67,500.00 TRA Parastatal Wages Retention Scheme 32,500.00 36,150.92 37,000.00 40,000.00 Election Costs 13,800.00 32,200.00 Census 40,000.00 Other Charges 168.156.80 216,665.23 264,890.63 323,749.58 Development expenditure 238,343.00 45,500.00 50,000.00 50,000.00 Projects 238,343.00 36,000.00 40,000.00 40,000.00 Local 23,400.00 36,000.00 40,00000 40,000.00 Foreign 214,943.00 Other Programme Assistance - Energy Fund Songo songo 9,500.00 10,000.00 10,000.00 Overall deficit (checks issued) - before grant (283.143.00) (103,230.10) (95.316.00) (92,230.75) Grants 266,603.00 185,600.00 190,300.00 144,000.00 import support/OGL 119,200.00 142,800.00 146,400.00 100,000.00 project grants 136,903.00 HIPC interim relief 10,500.00 42,800.00 43,900.00 44,000.00 Overall deficit (checks issued) - after grants (16,540.00) 82,369.90 94,984.00 51,769.25 Adjustment (0.00) - - Overall deficit (checks cleared) (16,540.00) 82,369.90 94,984.00 51,769.25 Financing 16,540.00 (82,369.90) (94,984.00) (51,769.25) Foreign 40,940.00 (22.100.00) (22,600.00) (22,600.00) Programmme loans 54,500.00 74,600.00 76,500.00 76,500.00 project loan 78,040.00 amortization (91,600.00) (96,700.00) (99,100.00) (99,100.00) Local (net) (8,000.00) (17,000.00) - - Bank (net) (8,000.00) (17,000.00) Non-bank borrowing - - - amortization - - - - Privatisation Funds - Change in Arrears (16,400.00) (15,000.00) Contigency (28,269.90) (72,384.00) (29.169.25) Financing Gap (0.00) (0.00) - memo item: GDPmp 6,280,400.00 6,996.680.00 7,756,799.00 8,619.665.00 OC for distribution 372,750.80 440,870.50 515,926.25 579,733.16 Primary Deficit(checks issued) (176.643.00) 21,269.90 7,684.00 26,969.25 Government Saving(checks issued) (44.800.00) (57,730.10) (45.316.00) (42,230.75) % of GDP (0.01) (0.01) (0.01) (0.00) Source: The Tanzanian authorities 172 Table Sb: Budget Frame For 199912000 - 2002103 (Analytical) % of GOP 199912000 20000t1 2001102 200203 Likely Ceilings Proj. Proj. Outturn I Domestic revenue 12.38 12.61 12.81 13.00 O/W Road Fund 0.64 0.59 0.56 0.52 Retention Fund - - - * Total Expenditure 16.88 14.08 14.04 14.07 Recurrent expenditure 13.09 13.43 13.40 13.49 interest on external debt 0.58 0.96 0.59 0.72 Interest on domestic debt 1.11 0.81 0.73 0.66 Wages/salaries 4.57 4.51 4.60 4.60 Goodstservices(transfers 6.82 7.14 7.47 7.51 otw Road Fund 0.64 0.59 0.56 0.52 Special exp. 1.88 1.64 1.68 1.98 CFS (Others) 0.88 0.84 0.82 0.78 TRA -- Parastatal Wages - - - Retention Scheme 0.52 0.52 0.48 0.46 Other Charges 2.68 3.10 3.41 3.76 Development expenditure 3.80 0.65 0.64 0.58 Projects 3.80 0.51 0.52 0.46 Local 0.37 0.51 0.52 0.46 Foreign 3.42 Other Programme Assistance - - Overall deficit (checks issued) - befo (4.51) (1.48) (1.23) (1.07) Grants 4.25 2.65 245 1.67 import support/OGL 1.90 2.04 1.89 1.18 project grants 2.18 - HIPC interim relief 0.17 0.61 0.57 0.51 Overall deficit (checks issued) - afte (0.26) 1.18 1.22 0.60 Adjustment - - Overall deficit (checks cleared) (0-26) 1.18 1.22 0 60 Financing 0.26 (1-18) (1.22) (0.60) Foreign 0.65 (0.32) (0.29) (0.26) import support loans 0.87 1.07 0.99 0.89 project loan 1.24 - amortization (1.46) (1.38) (1.28) (1.15) Local (net) (0.13) (0.24) - Bank (net) (0.13) (0.24) - Non-bank - - borrowing - amortization - - Priratisation Funds - Change in Arrears (0.26) (021) memo: GDPmp 6,280,400.00 6,996,680.00 7,756,799.00 8,619,565.00 Primary Deficit(checks issued) (2.81) 0.0 0.10 0.31 Government Saving(checks issued) (0.71- (0.83) (0.58) (0.49) Source: Table 5a 173 Table sa: RECURRENT EXPENDITURE BY MINISTRIESICEPARTMENTS INCLUDING TRANSFERS TO LOCAL GOVERNMENT vok* MinistryDep.rtment b19stik9 1 191120010 2040/01 2001/02 2002/03 PRVISLOKAL. ACTUAI. LiKl UTN IKM 1 t1940 PROJECTION POJEC %a 26 Adm3stlanon VICEPRESIDENT 185.384.048.00 270.319,538.00 25,702,948,40 297,579,625.12 310,168.902.44 27 Administation ,Rgstrr al roPoliticalP s 2,582.8 76.00 2677.242.784.00 2,837,764,101.20 3.007,316,473.28 3 . 987.68 30 AnIsr aioons P t'Oft.c and cabinet SaCMICiat 5.67,035,913.00 6.1 50.00 6.568.138.975.40 ,945,744.044.92 7,46,005.524.51 31 Adinistae Vic. Preid.n.Oficie 422,132.095100 433,410.872,00 457,770131.60 474.677.725.36 493010.714.75 32 Aiairo PresidentsOfltie- Ci Service Departnent 2245.553.556.00 1.490.644912,00 1.580.880.17.20 1.657.811,263.36 1.742.175.592.3e 22 A bministraton Ethics Secreteftt 139.796.825.00 171.611.300.00 196.465,961.00 205.469.211.56 215,012.557,15 34 Adm tlaon Mvntr o Foreign Affaits & it. Co-opcation 14.675.042.0090 11.8.5256,00 12,385.405,430,80 12,899.203,831 12 13.443.30.135 46 35 Admisal"" Permanent Cotmssion of Enquiry 205.547,252.00 291.107.91400 304.961,871.20 315,367.454 88 324,256.173.58 3S Adrnrnistrado Ci SeNice comirnssion 14,31.8925.00 167,018,692,00 490.999,999160 517.644.416 68 545749878 37 Admiistrat01o Pri0.rnste?sOfree 4,821.817.0.00 1.905.936.0eO,i0 2.014.278.940.40 2.097,251,805 6 2.185.203.0420t 40 Admastraten J,diciary 5.259,484.416.00 7,024.35.43600 7.809.741.703.80 1,050.786,211.36 8.30,293.403.79 41 Adm in MIOty ofJusltceu adCQnsOtutiona[lAtars 2,02466,40500 1,080,02(.54400 1.141,214.848.20 1,146.924.021.92 1,235.375,74608 42 AdmOsrbf ice of the Speaker 5,366.348,293.00 4,987,340.436100 5,265,749.441 80 .450.189.340.04 5.645.695,63217 45 AdmmistronExchequer and Au4 Departnent 874.637,771 .00 1,074.816.73200 1.635.858.1f6 60 1.712.290.117.08 1.793.307.963 39 50 Aan1stratM,on Mistry.fginance VOTE50 37.438.728.21100 4.730.938,020.00 4.405,113.725.91 4.640.116,934.40 4.889.220.335.31 M,n,str of Finanioe SPECIAL 57.647.831.262.05 0.05 005 0.11 Accountant Generars Office 1,032.630.000 2.544.58 800 00 2.661.263.064 00 2.784.93.5 Tanzania Revenue Autory 2C.977,000.0C 00 23,C74.709,000.03 25.362.170,.00.00 27,920.387,000,00 51 Admistraton MIstry oHomeAC r Afou5.1043.32500 3,556,270,164 00 4,173 477.113.20 4.228619.264.40 4.393.09,94467 54 Adm,in,straton Rado Tanznia 1.202.968,94500 1.220.362.708 00 1,289,960,624.40 1,344.526,031.56 1,402.369.46315 55 Adminitao nwta,i lvostmeiit Cenbre 491*977,73500 189.554 752.00 255,438.242.1 247.458.3 68 280.23CA08.10 56 Administrvtion ln.s1 ReGionII Admn nd .oc1 Go 539,440.758 00 1.138 584 300.00 1.206.899.358.00 1,279,313.319 48 1,356.072.118 60 57 -Admistrabo, 1mstry of D.fiens. and National Servie 1.875 12.057 00 654,488.716.00 692.372.015.0 725.182.759 84 759,962,093 46 59 Admnistraion L- ReformComriss,on 8645,341.00 173,95.112.00 201,366.184.60 207.3,156.72 213.717.979.41 60 Adm.nistrato.n Indystrial Court Of Ttnzania 134.996,027.00 165.245,800 00 239,78505.00 251.813,713.68 214.553.061 50 61 Ad.mistrtio. Electoral Commissont 1.578,314,478 00 13,865,057,676 00 32.068,310,559 00 4,011,930.451.39 4,168.310.559.80 63 Adrmistration Local Govegmment Seice Commission 174,949,442.00 2V1.521,464,00 254.103,594 20 266,141,983.16 278.902,675.46 68 Ad,tra'aion risdenrs Offic - Pfansnig Commission 2.247,925,16, 00 1.332.640.556.00 1,374.821.012.00 41.419.31.901 24 1,866.616,442.99 Admuiltrionl Reg.on 8.40,567,101.0 7,684,071,549,00 9,502.91.745.79 9.616,689.83422 10.525.696.40557 Adm.11nistraVo Loc.a GovernMent 4,746.241.914.00 8,5162,61,939,00 8.990.795,035.95 e,990.795.035.95 8,990.705.035.95 VOTE 33,35,55.59.0,603 Sub-Total 111.6,3014,042.90 10,246,365,100 133,151569,241.30 150.113.243,43.20 116,861,164,170.34 38 Delaence and Secunity Defence 72,534,069,147.00 80,884,42,40.CO 85.802.715,979 05 89.327.775,979.05 93.205.341,979 05 39 Delenice a Security The Nat,onal Serice 11,735466.972.00 10,921.331,116.00 11,623.565.67180 12,048.12.471.80 12.517,237,05I.80 20 efence and Securty Pobce Force 30.243.401.904.00 22.02.226.276 00 - 34.671.89. 70.80 35.26.937.695.40 37,397.479,412.44 29 Defenc. and Secnty MInisty of Home Af'air - Prisons 1449,531,01700 17,325,0993165 00 1543,502,161.0 19.503.105,134.90 20.55668.405.10 Sub-Total 130,$62,539.040,00 141.713,084,216.0 150,641,683.793.45 156,0.0942,441,05 163,500,727,943.41 46 S0ca.8se00s Mosty ofeducaton 16,496.655,54 00 15,737,402,192.00 22.697.431,51C60 25.530.233.111.20 30143.75.18808 52 Social s-e.s Ministryof Hei. n 23.135.390,844,00 22.397.677.46080 31.664,690.240.00 41,760,273.227,90 52.038,537.10924 53 Social se.-ces Mimst1y of Commnay Dev Gender . CUltu, 1.742,412 515.00 1.0953,.72.00 1,177,556.299.60 1.237,331,492.0 3 1.315,039.24394 65 SocMi sc0ices M.m,stry of40.o.w and'oui hDevelopment 1.!20 779,984.00 1,643.66,648.00 1,826,335,652 40 2,075,561.158.00 2.386.554,315.2 67 Soc:alSeNices Teacesse:viceCommtssion 117.391.574.00 221.772.06420 273 704.441.20 333.644 566.40 412026.72916 45 Secal0 0 semesMinistry of Science. Tenn & Higher Educe.on 15 485.983.105.00 22.083,408.575 0 24.345,101.5717 1 0.55.354.343.75 39.825.586.09425 49 Social services M5nstryofWater 0,000.724,340 00 2.953.742 24000 0 5.174,983,4C9 30 7,112,586,512 49 Soc¯Il sensees Raglons 11,484,938,026 00 10,124,033.283.00 13,441,444.295.61 14,451,070,14537 17,611.313,050.12 Socialse,t.as Local Goveomev 100,07s,791,351.00 144,134.517,158.00 3 64,610.339486073 174.388.337.811.47 108.169,226,366 74 Sub-Total 176.410,047,$9T.00 221,390,759,412.00 264,500,353,760,60 205.960,56.901,09 239,14,739,400.2 47 Etonom servces 2 V MllsyofWle 33.747.209 465,00 32,484.,89 136 00 34.899,260,42.80 36.451,495,950 45 37.543.690.115 33 48 Economic services n o f Lands & H1man Senements Dev 2.91,972.625.00 2,714,928,276 00 2,991,11,048.30 3,260,769 298 08 3,562.77697 27 56 Economic service MomstryEo Eery ndMWerls 2.202.295.20300 1,712,327,46400 2,212.71,00 40 2,417 5.165,64 2547,829.382.17 62 Economc services Munistry 0 Communcaions and Transport 12.330.8,695 00 6,465.309.736.00 7.126.555,489.60 7.775769,60244 8502,777,40d 60 E5oomse services Electricty bil 56 Econom s14CCS Ministry ot Regional Acm And Local Gov 11,518,500,000 00 12.404.944,732.00 12.635,146.969 20 13,355,146,961 60 16.09.112.202 Econom1c services LocaI g0vmment 1.490,422,4630 2.117.932.392.00 2.251.213,70 60 2.332.992,32,.84 | 24134.37927 Sub-Tor al 42.201,204,550.00 57.,9,211,340.90 32,126.110,707.60 65,594.133212.26 70,<7,17233,90 69 Produchve Miustryol Natura1ResourcesandTourism 81 ,026.101.96700 6.613,253.548.00 7.155.3,48.92.40 7,620,226,93500 9.134,509,924.78 43 Productive Mirusty 0o50A9riculture and o0optwe 14.597,587.03200 7,951,536,132.50 8.570.257,018.60 ' 9040,804,218 60 9,5.57,986.061.60 44 ProducOve Min stry oIndu0stsand Trade 3.352,796,091.90 1,327,499,164.00 1,440,026,562.20 1,547,541.930.20 1,153.250.835 00 Sub-,TotaI 23.576,430 een1 n , 15,399,290,044.09 07,165.032.243.0 18,202,23033.B0 18,345.2,721.38 SALARY50 IINCREASE 29,649.993,020.13 55.741.936.877.85 RECRul1TMEN0T - 2.0.00600 45005006 ,0,0,9,0 0NSUJRANCE 9 ,475.510,000 50 25,179.940.423.00 32.0750,20006 - CONTLNGEN4Cy' 2,643.056,99.35 1.750,35.259 22 1,955.539.70 1.50 , TOTA. MltSIES1DEPT3 0452,495,751,220,90 642.213.72900.65 642,203.924,751.79 742.258,37.00.73 05,361,0948,569_ 174 Tabic 61b: RECURRENT EXPENDITURE BY MINISTRIES/DEPARTMENTS INCLUDING TRANSFERS TO LOCAL GOVERNMENT Vote Ministry/Department 1998/99 1999/2000 2000/01 2001/02 2002103 PROVISIONA LIKELY CEILING PROJEC PROJE L ACTUAL OUTTURN TION CTION 26 Administration VICE PRESIDENT --0.03 0.05 0.04 0.04 0.04 27 Administration Registrar of Political Parties 0.46 0.49 0.44 0.41 0.40 30 Administration Presidents Office and Cabinct Secretariat 1.00 1.14 1.02 0.94 0.91 31 Administration Vice President's Office 0.08 0.08 0.07 0.06 0.06 32 Administration President's Office - Civil Service Department 0,40 0,27 0.25 0.22 0.22 33 Administration Ethics Secretaia-t 0.02 0.03 0.03 0.03 0.03 34 Administration Ministry of Foreign Affairs & Int. Co-operation 2.60 2.16 1.93 1.74 1,67 35 Administration Permanent Commission of Enquiry 0.04 0,05 0.05 0.04 0.04 36 Administration Civil Service Commission 0.03 0.03 0.08 0.07 0.07 37 Administration Prime Minister's Office 0.86 0.35 0.31 0.28 0.27 40 Administration, Judiciary 0.93 1.30 1,22 1.08 1.03 41 Administration Ministry of Justice and Constutional Affairs __0.36 0.20 0.18 0.16 0.15 42 Administration Office of the Speaker 0.95 0.92 0.82 0.73 0.70 45 Admministration Exchequerand Audit Department 0.16 0.20 0.25 0.23 0.22 StO Administration Ministry of Finance VOTE 50 6.64 0.87 0.69 0.63 0.61 Ministry of Finance SPECIAL 10.23 0.00 0.00 0.00 0.00 Accountant General's Office 0.00 0.19 0.40 0.36 0.35 Tanzania Revenue Authority 0.00 3.87 3.59 3.42 3.47 S Adininistration Ministry of Home Affairs 0.91 0.71 0.63 0.57 0.55 54 Administration Radio Tanzania 0.21 0.23 0.20 0.18 0.17 55 Administration Tanzania Investment Centre 0.09 0.03 0.04 0.04 0.03 56 Administration Ministry of Regional Administration and Local 0.10 0.21 0.19 0.17 0.17 Government 57 Administration Ministry of Defense and National Service 0.33 0.12 0.11 0.10 0.09 59 Administration Law Reform Commission 0.02 0.03 0.03 0.03 0.03 60 Administration Industrial Court of Tanzania 0.02 0.03 0.04 0.03 0.03 61 Administration Electoral Commission 0.28 2.56 4.99 0.54 0.52 63 Administration Local Governient Service Commission 0.03 0.04 0.04 0.04 0.03 66 Administration President's Office - Planing Commission 0.40 0.24 0.21 5.58 0.23 Administration Regions 1.51 1.42 1.48 1.3 1 175 dmnistion Local Government 0.84 1.58 1.40 1.21 1.12 VOTE 33,35,55,59,60.,63 0.00 0.00 0.00 0.00 0.00 Sub-Total 29.52 19.41 20.73 20.22 14.51 38 Defenc and Scurity Defence 12.87 14.92 13.36 12.03 11.57 39 Defence and Security The National Servicc 2.08 2.01 1.81 1.62 1.55 28 Defence and Security Police Force 5.37 6.01 5.40 4.84 4.63 29 Defence and Security Ministry of Home Affairs - Prisons 2.92 3.20 2.89 2.63 2.55 Sub-Total 23.24 26.14 23.46 21.13 20.31 46 Social services Ministry of Education 2.93 3.46 3.53 3.44 3.74 52 Social services Ministry of Healtli 4.11 4.13 4.93 5.62 6.54 53 Social services Ministry of Conununity Dcv. Gender & Culture 0.31 0.20 0.18 0.17 0.16 65 Social services Ministry of Labour and Youth Development 0.32 0.30 0.29 0.28 0.30 67 -Social services Teacher's Service Commission 0.02 0.04 0.04 0.04 0.05 68 Social services Ministry of Science, Tech.& Higher Education 2.75 3.70 3.79 4.16 4.95 49 Social services Ministry of Water 0.90 0.54 0.69 0.70 0.88 Social services Regions 2.04 1.7 2.09 1.97 2.19 Social services Local Government 17.76 26.58 25.63 23.49 23.36 Sub-Total 31.13 40.83 41.19 39.87 42.17 47 'Economic services 2/ Ministry of Works 5.99 5.99 5.43 4.91 4.66 46 Economic services Ministry of Lands & Human Settlements Dcv, 0.52 0.50 0.47 0.44 0.44 58 Economic services Ministry of Energy and Minerals 0.39 0.33 0.34 0.33 0.33 62 Economic services Ministry of Conununications and Transport 1.83 1.19 1.11 1.05 1.06 Economic services Electricity bill 0.00 0.00 0.00 0.00 0.00 56 Economic services Ministry of Regional Adm. And Local Govt. 2.04 2.29 1.97 1.80 1.99 Economic services Local government 0.26 0.39 0.35 0.31 0.30 Sub-Total 11.04 10.69 9.67 8.84 8.78 69 Productive Ministry of Natural Resources and Tourism 1.53 1.22 1.11 1.03 1.01 43 Productive Ministry of Agriculture_and Co-operatives 2.95 1.47 1.33 1.22 1.19 44 Productive Ministry of Industries and Trade 0.59 0.24 0.22 0.21 0.21 Sub-Total 5.07 2.93 2.67 2.45 - 2.40 SALARY INCREASE -- - 0.00 0.00 0.00 3.99 6.92 RECRUITMENT 0.00 0.00 0,39 0.54 0.68 INSURANCE 0.00 0.00 1.48 2.72 3.98 CONTINGENCY __ _0.00 0.00 0.41 0.24 0.24 TOTALMINISTRIES/DEFpTS - - ___ 100.00 100.00 100.00 100.00 100.00 Source: Table 6a I 1 176 Table 7a: RECURRENT EXPENDITURE BY REGIONS Vote 199899 199912000 200010 2001102 2002103 Prov.Actual LikelyOlturn CEILINGS Pro]. ProL 70 Arusha 1182,264.300.00 1.286,258,640.00 1,642,711,236.29 1.740,121,591.53 2.026,089.672.37 71 Pwani 869,877.400.00 745.512.956.00 982,363,356.78 1,041,239.650.93 1,119,674.118.65 72 Dodoma 874.370,800.00 976,256,964.00 1.271,023,777.11 1,355.96,316.24 1.685.603.881.59 73 Iringa 1,042,837.600.00 1,116.400,980.00 1,393.427,262.80 1,464,740,739.09 1,734.041.91308 74 Kigoma 709,706,10000 758,156.732-00 1,009.117,582.15 1,081,789,562.06 1.197.013.95070 75 Kilimanjaro 1,011,491,100.00 1,097.623.456.00 1,375,183,854.71 1,452.843,278.13 1.701.649.457.43 76 Lindi 705,977,800.00 759,434,06800 955.119,833'14 998,142,430.67 1.153,232.108.56 77 Mara 807,830,600.00 875.535.272.00 1.083,569,65020 1.126,86.305.67 1.261,048,046.42 78 Mbeya 827,246,10000 866.138,316.00 1.176,483,94580 1,265.210,386.37 1,572.011,139.40 79 Morogaro 1.055,890,500.00 1.158,719,632.00 1,497,355,68.19 1,594.207,940.26 1,915.100,65.01 80 Mtwara 713,453,600.00 811,056,720.00 1,047,184,775,35 1,099,589,193.66 1,181,933.508.13 81 Mwanza 1,064.283.300.00 1.183,829,336.00 1,493,648,056.06 1,562,595,202.88 1.692,217,11531 82 Ruvuma 746.538.800.00 629,635,304.00 1,039,929,917.21 1,089,076,406.22 1.194.750.742.47 63 Shinyanga 990,965,800.00 1,085,666,204.00 1,387.065,610.58 1,460,006.368.45 1,701.683,617.89 64 Singida 651,275,000.00 698,963,35600 898,421.496.09 948,806,869.70 1,063.430.787.30 85 Tabora 868.373,400 00 929.529.012.00 1.215,353,445.17 1,296,339,262.10 1,520.387,142.80 86 Tan\ga 995,996,400.00 1,033.666,32800 1,309,070.609.47 1,383,869,366.39 1,635.831.327.93 87 Kagera 630,188,500.00 739.604.212.00 955,645,566 36 1,008,889,279.42 1,158,063,698,67 88 Dar es Salaam 229,313.40000 279,510.296.00 402,996.480.17 428,613,163.99 550,916.840.45 89 Ru!a 633,213.500 00 576.607.048.00 808,687,895.80 871,460.665.83 1,071.412.121.62 Total Regions 16,411,094,000.00 17,808,104,832.00 22,944,368,041.40 24,270,365,979.60 28,137,011,855.79 Source. The Tanzanian authorities Table 7b: RECURRENT EXPENDITURE BY REGIONS (in percentages) Vote 1998/99 199912000 2000101 2001102 2002103 Prov. Actual Likely Otturn CEILINGS Proj. Prol. 70 Arusha 7.2 7.2 7.2 7.2 7.2 71 Pwani 4.1 4.2 43 4,3 4.0 72 Dodoma 5.3 5.5 5.5 5.6 6.0 73 lringa 64 63 6.1 6.0 82 74 Kigoma 43 43 44 4.5 4.3 75 Kilimanjaro 6.2 6 2 60 6.0 60 76 Lindi 43 4.3 4.2 4.1 41 77 Mara 4.9 49 47 4.6 4.5 78 Mbeya 5.0 49 51 5.2 5.6 79 Moragoro 6.4 6.5 65 66 68 80 Mtwara 43 4 6 46 45 42 81 Mwanza 65 66 65 64 60 62 Ruvuma 4.5 4.7 4.5 4.5 4.2 83 Shinyanga 60 61 60 60 60 84 Singida 40 39 39 3.9 3.8 85 Tabora 5,3 52 53 5.3 5.4 86 Tanga 6.1 58 5.7 5.7 58 87 Kagera 38 42 42 42 4 1 88 Dar es Salaam 1.4 t 6 1.8 1 8 2.0 89 Rukwa 3.9 32 3.5 36 318 Total Regions 100.0 100.0 100.0 100.0 100.0 Source: Table 7a 177 Table Sa: RECURRENT EXPENDITURE BY DISTRICT COUNCILS Vote 199899 199912000 2000101 2001102 2002/03 Prov. Actual Likely Olturn CEILINGS Pro]. Prol, 70 Arusha 5,521,986,075.17 8,882,024,09.00 10,700.130,90431 11.693.823,729.13 13.129,323,882.80 71 Pwani 3.099.510.332.22 5,611,006,210.00 6,472,446,683.69 6,917,842.47255 7,533,369.151.68 72 Dodoma 3,933,569,070.00 5,931,967,147.00 6,691,728,01320 7.030,858,496.85 7,505.205,71228 73 Iringe 5,069,176,570 06 7,441,058,680.00 8,321,306,14252 8,716.492.434.58 9,26375,485.1 74 Kigoma 3,460,938.26235 5,046,093,248.00 5,871,158,929.77 6,290,830,837.86 6,885,843,124.79 75 Kilimanjaro 6,942,569,64675 10,331.495,432.00 11,635,077.289.87 12,277,353.629.28 13,142,902,410.40 75 Lindi 2,600,759,497.52 4,069,803,258.00 4,805,233,941.61 5,216,929.287.14 5,779,495.737.51 77 Mara 4,455,030.987.50 6,424,364,070.00 7,341,449,080.59 7,786.875,53240 8,407.139,66240 78 Mbeya 6,260,829,005 13 9,059,893,849.00 10,148,305,887.61 10,612.266,275.07 11,278,828,046.11 79 Morogoro 4.693,718.79121 7,180,196,680.00 8,051,537,26968 8,441,995,178.87 8,987.622,917.36 8o Mtwara 3,353,770,17072 5,238,440,999.00 5,962,677,934.48 6,302,976,721.67 6,781.494,079.32 81 Mwanza 6,193,18139244 8,966,733,91800 9,942,000,066.24 10,338,872,642.99 10,897,107,431.31 82 Ruvumra 3,767,377.838.82 5.974.817,22400 6,771,203,47335 7.173,518,179.74 7.719,673,69037 83 Shinyanga 5,014,458,11568 7,418,453,21200 8,435,813.088.72 8.923,274,315.15 9,608,656,75954 84 Singida 2,991.498,982.63 4,531,602,137.00 5,337,016,534.80 5,B08,503,728.79 6,437,906,091.98 85 Tabora 3,410,069,236.71 4.688,086,09400 5.314,549,30938 5,618,557,628.15 6,039,155,843.11 86 Tanga 4,911,125,32557 7,449,226,54600 8,449,648,628.61 8,946,346,338.07 9,628,507,465.86 87 Kagera 5,129,646,06424 7,503,174.014.00 8,591,525,047.13 9,158,079,35408 9.933,133.55289 88 Dar es Salaam - 89 Rukwa 3,404,369,535,63 3,534,194,440 00 4,033,099,007 19 4,289,781,348 00 4.639,335,108.33 Total District 84,213,585,000.36 125,282,631,767.00 142,876,907,212.78 161,644,978,130.35 163,698,252,163.64 Source: The Tanzanian authorities. Table 8b: RECURRENT EXPENDITURE BY DISTRICT COUNCILS (in percentages) Vote Region 199899 199912000 2000101 2001102 200203 Prov. Actual Likely Otturn CEILINGS Prol. Prof. 70 Arusha 66 7 1 75 7,7 8o 71 Pwani 3.7 45 4.5 46 46 72 Dodoma 4.7 47 47 4.6 46 73 Iringa 6O 59 58 5.8 57 74 Kigorna 41 4O 4.1 4,2 42 75 Kdimararo 82 82 6.1 8T 8,0 76 Lindi 3,1 3.2 34 34 3.5 77 Mara 53 51 51 51 51 78 Mbeya 74 72 7 1 7.0 69 79 Morogoro 56 57 56 56 55 80 Mtware 40 42 42 42 4.1 81 Mwanza 7.4 7 2 70 6.8 67 82 Ruvurna 4,5 48 47 4.7 47 83 Shunyanga 60 59 59 5.9 59 84 Strigida 3.6 36 3.7 3.8 39 85 Tabora 4.0 17 37 37 37 86 Tanga 58 59 59 59 59 87 Kagera 61 60 6.0 60 6.1 88 Dar es Salaam 00 00 0.0 0.0 00 89 Rukwe 40 2.8 28 2.8 2.8 Total District 100.0 100.0 100.0 100.0 100.0 Source: Table 8a 178 Table 9a: RECURRENT EXPENDITURE BY URBAN COUNCILS Vote 1998J99 199912000 2000101 2001102 2002103 Budget Likely Olturn CEILINGS Proj. Proj. I Arusha 992.155,200.00 1,441,049,655.00 1,574.915,748.65 1,613,293,687.82 1,671.945.582.14 2 Dodoma 1.292,828,300.00 1,795,548,186.00 1,990,944,127.60 2,048,026,178.05 2.135.522,571.98 3 Iringa 618,131,800.00 926,445,046.00 1.027,662.179.48 1,062,959.416.12 1.116,794,917.57 4 Kigoma 485,915.900.00 678,442,854.00 774.778,549.14 810,431.878.81 865,100,408.55 5 Lindi 297*748,600.00 463.958,993.00 542,720,082.02 577,147,853.90 629,827,566.11 6 Moshi 766,302.800.00 1,175.306.653.00 1,294,032,173.27 1.329,444,133.39 1,383,720.872.87 7 Musoma 832,263,100.00 972,923,105.00 1,128,567,453.33 1:191,770.294.14 1,288,708,248.45 8 Mbeya 1,060.774,900.00 1.47S,072,888.00 1,615,766,104.40 1,655,363.311.65 1,715,982,999.54 9 Motogoro 976,055,900.00 1,519,282,047.00 1,686,550,337,13 1.740.972,926.90 1,824,317,753.72 10 Mtwara 350.842,500.00 551,520,706.00 620,631,900.35 645,592,551.35 683,833,008.73 11 Mwanza 1,137,179,100.00 1,704.523,072.00 1,853,591,068.31 1,890,498,208.94 1,947,109,713.25 12 Songea 680,350,400.00 1,055,229.876.00 1,252,375,859.39 1.336,754,259.92 1,466,274,490.23 13 Shinyanga 516,281,300.00 790,445,848.00 917,843,808.56 968,109,616.50 1,045,195,211.03 14 Singida 514,146,200.00 788,295,171.00 903,919,895.39 952,929,521.72 1,027,766,626.55 15 Tabora 1,040,607,700.00 1,462,053,770.00 1,786,294.963.61 1,929,559,587.73 2.149,184.740.64 16 Tanga 1,124,159,700.00 1,687,564,433,00 1:867,845,438.50 1,923,023,551.00 2,007.690.825.04 17 Bukoba 441,949.900.00 679,119,247.00 814,139,004.22 871,161,200.60 958.699,133.75 18 Dar es Salaam 6,297,559,900.00 8,552,891,705.00 8,989,559,183.47 8,996,659,517.14 9,007,402,700.16 flala - 222,157.100.00 377.397,012.72 467,436,990.07 605,092,738.90 Temeke 212,735,800.00 353,917.155.13 438,255,085.00 567,151,928.14 Kinondoni - 185,033,700.00 308,706.564.70 382,065,171.84 494.096,695.58 DSSD 212,119,000.00 252.910,862.00 265,556,405.10 265,556,405.10 265,556,405,10 19 Sumbawanga 706,680,000.00 940,069,005.00 1,038,726,004.05 1,070,135,696.24 1,118,178,490.39 Total Urban 20,346,052,400.00 29,532,579,722.00 32,986,441,018.51 34,167,147,043.91 35,975,153,628.42 Source: The Tanzanian authorities. Table 9b: RECURRENT EXPENDITURE BY URBAN COUNCILS (in percentages) Vote 1998(99 199912000 2000101 2001102 2002103 Prov. Actual Likely Ofturn CEILINGS Proj. Proj. I Arusha 4.9 4.9 4.8 4.7 4.6 2 Dodoma 6.4 6.1 6.0 60 59 3 Iringa 3.0 3.1 31 3.1 3.1 4 Kigoma 2.4 2.3 2.3 2.4 2.4 S Lindi 1.5 1.6 1.6 1.7 1.8 6 Moshi 3,8 4.0 3.9 3.9 3.8 7 Musorna 4.1 3 3 3.4 3.5 3.6 8 Mbeya 5.2 5.0 4.9 4.8 4.8 9 Morogoro 4.8 5.1 5.1 5.1 5.1 10 Mtwara 1.7 1.9 1.9 1.9 1.9 11 Mwanza 5.6 5.8 5.6 S.S 5.4 12 Songea 3.3 3.6 3.8 3.9 4.1 13 Shinyanga 2.5 2.7 2.8 2.8 2.9 14 Singida 2.5 2.7 2.7 2.8 2.9 15 Tabora 5.1 5.0 5.4 5.6 8.0 16 Tanga S.5 5.7 5.7 5.6 5.6 17 Bukoba 2.2 2.3 2.5 2.5 2.7 18 Dar es Salaam 31.0 29.0 27.3 26.3 25.0 1la 0.0 0.8 1.1 1.4 1.7 Temeke 0.0 0.7 1.1 1.3 1.6 Kinondoni 0.0 0.6 0.9 1.1 1.4 DS0 1.0 0.9 0.8 0.8 0.7 19 Surnbawanga 3.5 3.2 3.1 3.1 3.1 Total Urban 100.0 100.0 100.0 100.0 100.0 Source: Table Sa 179 Table 10a: DEVELOPMENT EXPENDITURE-MINISTRIES VOTE MINISTRYJREGION 199899 1999120 0 200001 2001102 2002/03 I Budget Likely Oturn Callings Prol. Pro). 26 VICE PRESIDENT 27 Registrar of Political Parties 28 Police Force 29 Ministry of Home Affairs - Prisons 30 Presidents Office and Cabinet Secretariat 3,000,000,000 2,195,671,212 2,679,320,763 500,000.000 200,000,000 31 Vice Presidents Office 0 32 Presidents Office - Civil Service Department 500,000,000 365,945,202 500,000,000 5.W0,00 500,000.0 33 Ethics Secretanat 34 Ministry of Foreign Affairs & Int Co-operation 35 Permanent Commission of Enquiry 36 Civil Service Commission 37 Prime Ministers Office 200,000,000 146.376,061 200,080,000 363,621,880 416,950,505 38 Defence 39 The National Service 40 Judiciary 409,307,832 500,000,000 450,000,000 41 Ministry of Justice and Constitutional Affairs 42 Office of the Speaker 43 Ministry of Agriculture and Co-operatives 2,437,500,000 1,783,982,860 2,555,329,062 2,948,708,405 3.200,000,000 44 Ministry of Industries and Trade 0 45 Exchequer and Audit Department 0 50,000,000 50,000,000 50,000,000 46 Ministry of Education 2,131,250,000 1,559,841,424 2,234.274,898 4,407,658,156 4,434,552,966 47 Ministry of Works 4,000,000,000 2,927,561,616 5,000,000,000 6,080,000,000 6,000,000,000 48 Ministry of Lands & Human Settlements Dev. 500,000,000 365,945,202 1.024,170,064 1,033,944,754 1,040,515,865 49 Ministry of Water 3,225,008,000 2,360,346,553 3,212,738,251 3,500,000,000 3,500,000,000 50 Ministry of Finance VOTE 50 1,322,000,000 967,559,114 1,450,0M,000 2,000,000,00 1,518.116,202 51 Ministry of Home Affairs 0 52 Ministry of Health 3,375,000,000 2,470,130,114 3,538,147.932 3,500,000.000 3,500,000,000 53 Ministry of Community Dev. Gender & Culture 0 352,480,609 500,000,000 54 Radio Tanzania 1,600,000,000 1,171,024,647 500,000,000 500,000,000 500,000.000 55 Tanzania Investment Centre 0 56 Ministry of Regional Adm &Local Govt. 193,750,000 141,803,766 290,625,008 387.500,002 389,864,462 57 Ministry of Defense and National Service 1,000,000,000 731,890,404 1,000,00000 1,000,000,000 1,000,008,000 58 Ministry of Energy and Minerals 1,743,750,000 1,276.233,892 1,828,043,098 1,828,043.098 2,000,000,000 59 Law Reform Commission 60 Industrial Court of Tanzania 61 Electoral Commission 62 Ministry of Communications and Transport 302,020,000 300,000.002 63 Local Government Service Commission 65 Ministry of Labour and Youth Development 66 President's Office- Planning Commission 500,000,000 365,945,202 500,000,000 500,000,000 500,020,000 67 Teacher's Service Commission 0 B8 Ministry of Science, Tech.& Higher Education 1,743,750,080 1,278,233.892 1,828,043,098 1,828,043,098 2,000,000,000 69 Ministry of Natural Resources and Tourism Total Ministries 27,472,000,000 20,106,493,182 28,800,000,000 32,000,000,000 32,000,000,000 NOTE 180 Table 10b: Development Expenditure Ministries (in percentage) VOTE Ministry/Region 1998199 1999100 2000101 2001102 2002103 Budget I Likely Otturn Ceilings Proj. Proj. 26 Vice Presidents Office - - 27 Registrar of Political Parties . - - - 28 Police Force 29 Ministry of Home Affairs - Prisons - - - - 30 President's Office and Cabinet Secretariat 10.9 10.9 9.3 1.6 0.6 31 Vice President's Office - - - 32 Presidents Office - Civil Service Department 1.8 1.8 1.7 1.6 1.6 33 Ethics Secretariat - - 34 Ministry of Foreign Affairs & Int. Co-operation - - - - 35 Permanent Commission of Enquiry - - - - 36 Civil Service Commission - - - - 37 Prime Minister's Office 0.7 0.7 0.7 1.1 1.3 38 Defence - 39 The National Service - 40 Judiciary 1.4 1.6 1.4 41 Ministry of Justice and Constitutional Affairs . - - - 42 Office of the Speaker - - - 43 Ministry of Agriculture and Co-operatives 8.9 8.9 8.9 9.2 10.0 44 Ministry of Industries and Trade - - - - - 45 Exchequer and Audit Department - - 0.2 0.2 0.2 46 Ministry of Education 7.8 7.8 7.8 13.8 13.9 47 Ministry of Works 14.6 14.6 17.4 18.7 18.7 48 Ministry of Lands & Human Settlements Dev. 1.a 1.8 3.6 3.2 3.3 49 Ministry of Water 11.7 11.7 11.2 10.9 10.9 50 Ministry of Finance VOTE 50 4.8 4.8 5.0 6.2 4.7 51 Ministry of Home Affairs - - - - - 52 Ministry of Health 12.3 12.3 12.3 10.9 10.9 53 Ministry of Community Dev. Gender & Culture - - - 1.1 1.6 54 Radio Tanzania 5.8 5.8 1.7 1.6 1.6 55 Tanzania investment Centre - - - - - 56 Ministry of Regional Adm.&Local Govt. 0.7 0.7 1.0 1.2 1.2 57 Ministry of Defense and National Service 3.6 3.8 3.5 3.1 3.1 58 Ministry of Energy and Minerals 6.3 6.3 6.3 5.7 6.2 59 Law Reform Commission - - - - - 60 Industrial Court of Tanzania - - 61 Electoral Commission - - 62 Ministry of Communications and Transport - - - 0.9 0.9 63 Local Government Service Commission - - - - - 65 Ministry of Labour and Youth Development - - - - - 66 Presidents Office - Planning Commission 1.8 1.8 1 .7 1.6 1.6 67 Teacher's Service Commission - - - - - 68 Ministry of Science, Tech.& Higher Education 6.3 6.3 6.3 5.7 6.2 69 Ministry of Natural Resources and Tourism - - - - - Total Ministries 100.0 100.0 100.0 100.0 100.0 NOTE: Based on local component only. Source: Table IOa 181 Table 11a: Development Expenditure-Regions 199912000 199912000 2000101 2001102 2002103 Budget Likely Oltum Ceilings Pro. Pro. 70 Arusha 343,570,000 251,455,586.14 549.712,000.00 610,791,111.11 610,791,111.11 71 Pwani 205,342,000 150,287,839.36 328,547,200.00 365,052,444.44 365,052,444.44 72 Dodoma 196,285,000 143,659,107.97 314,056,000.00 348,951,111.11 348,951,111.11 73 Iringa 249,342,000 182,491,017.14 398,947,200.00 443,274,666.67 443,274,666.67 74 Kigoma 167,228,000 122,392,568.50 267,564,800.00 297,294,222.22 297,294,222.22 75 Kilirnanjaro 252,342,000 184,686,688.35 403,747,200.00 448,608,000.00 448,608,000.00 76 Undi 213,342,000 156,142,962.59 341,347,200.00 379,274,666.67 379,274,666.67 77 Mara 218,785,000 160,126,642.06 350,056,000.00 388,951.111.11 388,951,111.11 78 Mbeya 348,456,000 255,031,602.65 557,529,600.00 619,477,333.33 619,477,333.33 79 Moragoro 212,785,000 155,735,299.64 340,456,000.00 378,284,444.44 378,284,444.44 80 Mtwara 194,785,000 142,561,272.36 311,656,000.00 346,284,444.44 346,284,444.44 81 Mwanza 278,899,000 204,123,501.81 446,238,400.00 495,820,444.44 495,820,444.44 82 Ruvuma 199,228,000 145,813,061.43 318,764,800.00 354,183,111.11 354,183,111.11 83 Shinyanga 240,899,000 176,311,666.46 385,438,400.00 428,264,888.89 428,264,888.89 84 Singida 139,228,000 101,899,637.18 222,764,800.00 247,516,444.44 247,516,444.44 85 Tabora 237,042,000 173,488,765.17 379,267,200.00 421,408,000.00 421,408,000.00 86 Tanga 256,342,000 187,614,249.97 410,147,200.00 455,719,111.11 455,719,111.11 87 Kagera 237,342,000 173,708,332.29 379,747,200.00 421,941,333.33 421,941,333.33 88 Dar es Salaam 118,530,000 86,750,969.60 189,648,000.00 210,720,000.00 210,720,000.00 89 Rukwa 190,228,000 139,226,047.79 304,364,800.00 338,183,111.11 338,183,111.11 Total Regions 4,500,000,000 3,293,506,8181 7,200,000,000 8,000,000,0001 8,000,000,000 Note: Based on local component only. Source: The Tanzanian authorities. Table 11b: Development Expenditure-Regions (in percentage) 199912000 199912000 2000101 2001102 2002103 Budget Likely Oltum Ceilings 1 Proj. Proj. 70 Arusha 7.6 7.6 7.6 7.6 7.6 71 Pwani 4.6 4.6 4.6 4.6 4.6 72 Dodoma 4.4 44 4.4 4.4 4.4 73 Iringa 5.5 5.5 5.5 5 5 5.5 74 Kigoma 3.7 3.7 3,7 3.7 3.7 75 Kilimanjaro 5.6 5.6 5.6 5.6 5.6 76 Lindi 4.7 4.7 4.7 4.7 4.7 77 Mara 4.9 4.9 4.9 4.9 4.9 78 Mbeya 7.7 7.7 7.7 7.7 7.7 79 Morogoro 4.7 4.7 4.7 4.7 4.7 80 Mtwara 4.3 4.3 4.3 4.3 4.3 81 Mwanza 6.2 6.2 6.2 6.2 6.2 82 Ruvuma 4.4 4.4 4.4 4.4 4.4 83 Shinyanga 5.4 5.4 5.4 5.4 5.4 84 Singida 3.1 3.1 3.1 3.1 3.1 85 Tabora 5.3 5.3 5.3 5.3 5.3 86 Tanga 5.7 5.7 5.7 5.7 5.7 87 Kagera 5.3 5.3 5.3 5.3 5.3 88 Dar es Salaam 2.6 2.6 2.6 2.6 2.6 89 Rukwa 4.2 4.2 4.2 4.2 4.2 Total Regions 100.0 100.0 100.0 100.0 100.0 NOTE: Based on local component only Source: Table 11a 182 Table 12: Sectoral Recurrent Allocation 1999/2000 - 2002/03 1998/99 1999100 PE ACT PE EST OC ACT OC EST Total Act. Total Est. PE OC Total Administration Ministies/Deprtment 11,792,943,974 13,273 ,14,771 i41,315,041,053 127,950,802,156 153,107,985,027 14f,223,916,927 15,77,540,4-20 191,110,381,400 206,817,921,820 Regions 3,040,952,077 3,507,237200 5,449,615,024 2,25,343,645 8,490,567,101 6263,580,845 4,654,004,549.39 3,030,067,000 7,684,071,549,39 Local (Govenmeunt 4,746,841,914 4,778,770,60C -___ 4,746,841¯9T4 4,77877~60 8,562,661 ,955 _______- 8,562,661,955 c,346,557,746135 - 3,346,557,746.35 3,369,067,700 6,276,964,968 - 6,276,964,968 3,369,067,700 UranCun ¯49,702,90 2,285,66,987 1,400,284,167.65 1,409,702,900 - 1,400,284,167.65 - 2,285,696,987 TotalDefe_nce and 19,580,737,965 21,559,122,571 146,764,656,077 130707,145801 166,345,394,042 152,266,268,372 28,924,206,924.39 194,140,448,400 223,064,655,324.39 Security Däefence and ecuri-ty Ministries/Department 70,133,382,154 75¯,541,249,71 60,829,1 56,886 47,742,400,389 130962,539,40Ö I260 85,151,077,816 56,562,006,400 141,713,084,216 Total Defencc and 70,133,382,154 75,541,249,711 60,829,1 7,742,400,389 130,962,539,040 123,283650100 85,11,077,8 56,562,006,400 141,713,084,216 Security ___ ______________ _____________ E ducation -___ MNiestrics mepdrllnnt --,9S,5 483i20 9,61 5,855,9~0 2,504,781,911 23,426,77¯8i¯ 32,100,030,837 33,041933,7o 13,710,079,531 25,332,503,300 39,042,582,3 Regins 5,643,975,525 6,497,176,896 2,625,179,853 809,0ii2,393 8,269,155,378 __7,306,209,291 177,521,827 707,310,500 884,832,327 Local Govennent 67,069,374,672 67,520,503,440 4,985,195,103 3,312,308,914 72,054,569,775 70,832,812,354 107,816,287,827 11,106,720,300 118,923,008,127 Dtt 53.990,846,611 54,354,005,269 ; 4,057,948,814 6S6946¯658,048,795,425.38 57,050,224,725.88 88,934,167,267 9,260,685,000 98,194,852,267 n hiCounils 13,078,528,061.11 13,166,498,170 927,246,289 616,089,458.16 14,005,774,350.34 13,282,587,628.96 18,882,120,560 1,846,035,300 20,728,155,860 Sul Total 82,308,599~23¯4) ¯ li36ñ3 30,115,156,867 27,547,419,110 ~1,T2355Yf Tí,98T 3, ~ 121,703,8898 G 145 0 158,850,423,285 Ministries/Dep arnäti 2,3 ,832 421441,335,2Ö 20,785,332,012 15,65,858OÖ00 23,35,39084 18,407,193,200 -3,8155,86 18,512,521,800 22,397,677,660 Regions 1,410_,993,881.28 1,624,294,224 656,294,963 202,258,098.90 2,067,288,844.68 1,826,552,322.90 8,529,799,355.03 709,401,600 9,239,200,955.03 Toc1 nnoEt 16,767,343,667.34 16,8801,1 25,860 1,246,98,75.84 828,077,1 65.46 18,013,642,443.18 17,708,203,025.46 19,605,298,979 2,628,028,800 22,233,327,779 District 13,497,711,652.21 13,588,501,317.3 1,01 4,487,203.53 64054,812.68 143512¯19,553.74 14,262,556,129.98 14,511,127,448 1,876,90ž~200 16,388,029,648 0 0 UJrbaun 3,269,632,015.13 3,291,624,542,70 231,811,572.31 154,022,352.78 3,501,443,587¯44 3,445,646,853 5,094,171,531 751,126,600 5,845,298,131 S,4-T9,75 -- 3-380,Ö2 77-,165755286 87,92,751 116 ,644 138,32213.6 37,8 ,04836 ,05,2948.97 2 2,83,70 27,203,3274]3 Water 183 ¯6,645,1u0 ,71635,600 3,43039¯60 79914,000 0~7Õ¯4 2,596,29,600 1,952,037,84D 1,001,704,400 2,953,742,240 Ministrics/Departm,cnt Regions ¯783,885,48960 902,385,680 36408,33 12,365,610.50 1,148,493,802.60 1,014,751,290.50 L~cel~Govemninent 1,-5,190,926.30 377,847,700 69ž88,208.80 466,,42,869.77,007,579,735 9,831¯%,¯6910 913,33 ,00 2,978,281,25 Distriwt ¯ 7,498,728.695.67 7,549,167,39830 563,604,001.96 374,474,895.94 8,062,332,697.63 7,923,642,294.44 1,831,643,843 1,033,587,300 2,865,231,143 Urbi Cu ]cil, 1-816,462,23.63 41,298¯»0,301.5o 128,84,6 4 85,567,97.7 1,945, 37.47¯¯ 1,4,248,175.26 8,539,69 3 R40 1 3,00~92 SulG¯TotaI 1,715f721 95¯90 1,996,38,980~4¯491,055,681.80 i,45-2,322¯,4 , 45(¯ž777,217.70 1,448,86 1,460.-2 3865,22¯T5 2¯066,8020 ~ 93 5 So¯ial otirš 1,433183¯173 1,513YC00 2,1,03 -7001,883,0i 3 , ä, 90 20Ö5,4(,900 1,9 T64,720 816,941,80 _ 2,738,106,526 TotaSuciaiue Sctor 15,85,90273 N879794¯450 ¯9¯42147,60 4,697,817,855 175,410,047~0¯3 164,777,612,255 159510,529,474.61 61,880,230,200 221,390,759,674.61 Economic infrastructure Roatds Mil-ries/Dpatment 1,857,313,265 1,935,046,800 43,408,396,200 48,535,285,100 45,265,709,465 50,470,331,900 2,741,322,568 42,148,391,300 44,889,713,868 ____ (1) _________- (1) _____- ___ - - -- 0cl vÖi46t ¯ ¯,7¯94~81 1,105,289,700 j91,517,602 296,671,400 149,¯422,463 1,401,961,100 1,553¯,65 93 534,067,100 2,117,932,393 DKistrict 89,302,937.41 895,284.657 317,939,257.62 240,303,834 1,207,242,195.03 1,135,588,491 1,196,867,441 360,686,300 1,557,553,741 Urban 208,601,923.59 210,005,043 74,578,344.38 56,367,566 283,180,267.97 266,372,609 386,997,852 173,380,800 560,378,652 Council- Sub-ftal - ,955,21,15 3,040,336,500 43,800,913,801 48,83,956 464,756,131,926 51,872,293,00 4,325,187,861 42,682,458,400 47,007,646,261 Others Sinistries/Deparinnt 2,1 40,523,6Š 2,875,7016,200 I3,304,63973 T 459¯,T76¯,00 ,-445,1S,623 14,334,882,200 2,822,628,780 8,139,936,900 10,962,565,680 Regions () (1 ) (2) Loeal Govciuiiiiti Iban C Counc iis Su-Toää I2-,14(Ciž349 2,75,706,200¯ 13,304,633,972 11,459,176,000 15,445,157,621 4,334,882,200 2,822,628,780 8,139,936,900 10,962,565,680 Total E-onor - 5,09574174 5,916,0410 57,1 05,547,773 - 0j91,A32,500 ¯62,201,,897 60¯¯ lŠ¯641 50,822,395,300 57,970,211,941 184 fntiastructure _______________________ _____ _______________ P d-uctv c _ _ _ _ ___ _ _ _ _ -_ _ _ __ aini-stri -i)c-rn 1t -2 9287,32771 -0,5 50,3 9,100 19,28 9 7,152,1 7135,288,400 2,576,480,690 22,925,607,500 6,553,569,144 9,345,719,700 15,899,288,844 Regions -1 _ (1) - (1) - (2) - - - Local Govcinnent District- UIrban_c6ii s Tåtäl Productiv- 9977,718 1,ó,319,100 9,289,12,70 375,288,400 28,576,480,688 22,925,607,500 6,553,569,144 9,345,719,70 15,899,288,844 Salary increanse Recriitmnent Insurance Contingency ____ ________________ Gi1n¯dTotal 220,083,089,884 231,646,528,482 343,412,661,336 297,813,784,945 563,495,751,220 529,460,313,427 287,287,200,000 372,750,800,000 660,038,000,000 Source: De Tauzanian Authorities Note: /1 Road fund allocation to Ministry of Regional Administration and Local Governinent as weil as Mnistry of Works is included in OC. /2 Assumptions for distribution of OC and PE for regions and local govermnent are as tllows Education 72% Ilealhi 18% Water 10% /3 Assumaptions for distribution between urban and district councils lor PE3 and OC are as follows lhan 19.5% District 80.5% oC Urban 18.6% District 81.4% /4 OC allocations do not inelude parastatal wages whvich iscaptured in the special expenditure 185 Table 12b: Sectoral Recurrent Allocation 1999/2000 - 2002/03 (in percentage) 1998/99 1999/00 PE ACT PE EST OC ACT OC EST Total Act. Total Est. PE OC Total Administration 5.45.7 41.2 43.0 -- -27.2 26.7 5.5 51.3 31.3 Ministrics/Dcpartinent Reions 1.4 1.5 1.6 0.9 1.5 1.2 1.6 0.8 1.2 Local Governent 202 2-- (.0 0.8 0.9 3.0 0.0 1.3 Disirict 1 .5 0.0 0.6 0.6 2.2 0.0 1.0 b0. 6 . 6 0.0 0.0 0.2 0.3 0.8 0.0 0.3 Councis T¯t¯alAdminitrjtiön -8.9 - 9 4¯2.7 - 43,9 - 293 28.8 10.1 52.1 33,8 nånce andSecurity 31.9 32.6 17.7 16.0 23.2 23.3 29.6 15.2 21.5 Ministries/Departinent Total Defnce a-d 31.9 32.6 17.7 16.0 23.2 23.3 29.6 15.2 21.5 Security Social Sctor-s d-ucation __6.__ 5.9____ ___ ________ ________ ________ 4.4 4.2 6,6 7.9 5.7 6.2 4.8 6.8 5.9 Ministries/i)epartn..t -cgiins ¯ 2.6 2.8 0.8 0.3 1.5 1.4 0.1 0.2 0,1 Local Govenetänt 30.5 29.1 1.5 1.1 12.8 13.4 37,5 3.0 18.0 I)iti¯c 24-s 23¯5 1.2 0.9 10.3 10.8 31.0 2.5 14.9 ibi T9 5¯7 3 .2 2¯56 6.6 0.5 3.1 ,Councils SubTotal 37.4 36.1 8.8 9,2 20.0 21.0 42.4 10.0 24.1 l 16.1 SA 4.1 3,5 f.4 5.0 3.4 Ministrics/)cpriitmnent Xegions ____ __ 0.6 0.7 0.2 0.1 0.4 6.3 3.0 0.2 1.4 Local onermnt 7.6 7.3 0.4 - 0.3 3.2 ---3.3- ---6.8 0.7 3.4 Disic6.1 59 0.3 0.2 2.6 2.7 5.1 0.5 2.5 Urbhan 1.5 1.4 0.1 0.1 0.6 0.7 1.8 0.2 0.9 Councils1 186 Suli-Tota7 9.3 9. 6.6 5.7 1_7.2_11.1_.98.2 Waterý -33 - o.7 0.7 . 0.3 0.9 0,5 0.7 0.3 0.4 .4 0.4 0.1 (.0 0.2 0.2 0 0.0 0.0 Sa venuzint 4.2 - T 0.2 0.2 1.8 1,9 0.7 0.3 0.5 istrict- 3.4 -3.3 ~2 0.1 1.4 1.5 0.6 0.3 0.4 Urban 0.8 0.8 0.0 0,0 0.3 0.4 0.0 0.0 0.0 otal 5.3 5.2 1.3.52.9 2.5 1,3 06 0.9 So a thers _ 0 7 06 0.6 0.2 0.6 0.4 0.7 0.2 0. Tota S c a Sectors 52. 1 -0 17 3 157 731 1 31 .1 55.5 16.6 33.5 Econorme Infrastucture Roads__________ _____ __ og - 28 1.6 16 95 1.0 11.3 6.8 Minis(ricA/)paint ____ __ R_0.0 00.0. 000 0 _ ¯.0 0.0 0.0 Léc Gvnunent 0.5 - 005 0.1 0J 0.3 0.3 0.6 0.1 0.3 -0 0 -4 0 1 - - - - - - -- 0 .2 0 .4 0 .1 0 .2 han 60I - o 00000. . 0.1 0.0 0.1 Såi1.3 1. 128 16-4 83 9.8 i.5 11.5 7.1 1.2 3.9 3.8 2.7 2.7 1.0 2.2 1.7 Ministries/D)epatimenl - -o____ ö -___ -o_______ 0_________ __ 0_____ egi0.0 0.0 0.0 0.0 0.0 0.0 L wca i ovemnnnt 0.0 00 0.0 ,00.0 0.0 0.0 0.0 0.0 )istrict 0. 0 0.0 00 0.1) 0.0 0.0 orb 00 0. 00 00 O0 0.0 0.0 0.0 1u t 1 2 9 8 2.72 1.' -n-¯2.316 2 1 13.6 8. Infra.structure ___ ____ ________ ________ ____ 187 Productive 42 4.6 5.6 4.2 5.1 4.3 2.3 2.5 2.4 Ministries/)epartmen Reions 0.0 0.0 0.0 _ent 0 0 0.0 0.0 0.0 0.0 0.0 Dica riovemin t 0 0.0 0.0 ¯ .0 0 0 0.0 ¯¯__Õ D oistrict - 0.0 ..0 .) 0.0 0.0 0.0 0.0 Urban 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Councils Total Productive __ 4.2 4.6 5.6 4.2 - 5.1 4.3 2.3 2.5 2.4 Salary increase 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 ~0.0 uj cri ntii0.0 0.0 ) 0 0.0 0.0 0.0 insurance 0.0 0.0 0.0 0.0 .0 0.0 0.0 0.0 0.0 Cf.i 0¯ 0 0 0.0 0.0 ¯¯ 0.0 0.0 Grand Total 100 0 100.0 100.0 100.0 100.0 10 0 10. 100.0 100.0 5ource:ubkl2a 188 Ta ble l3a: Sectoral Developmeiit Allocation 2000/2001 - 2002/03 Ministrics/Departments 1998/99 ___199912000 2000/01 2001/02 2002/03 Budget Likely O/turn Ccilings Projection Projection Administration___ __________ Ministries/Departin¯ent ¯93,750,000.00 5,354,327,223.82 6,579,253,595.06 5,653,602,488»70 5,024,931,168.82 Defence and Security Ministries/Dcpartnicnt 731,890,404.10 1,000,000,000.00 1,000,000,000.00 1,000,000,000.00 Total Defence and Security 193,750,000.00 6,086,217,627.92 7,579,253,595.06 6,653,602,488.70 6,024,931,168.82 Social Sectors Education Ministries/Departnlct 3,875,000,000.00 2,836,075,3.15.90 4,062,317,996.51 6,235,701,254.02 6,434,552,965.83 ti ealth__________________________ Ministries/Dcpartnent 3,375,000,000.0)0 2,470,130,113.85 3,538,147,932.44 3,500,000,000,00 3,500,000,000.00 Water Ministries/Departnent 3,225,000,000.00 2,360,346,553.23 3,212,738,251.22 3.500,000,000.00 3,500,000,000.00 Total i¯tial~Sect r 1l,75, i0.ni 7,666,551,982.99 1,813,2(4,180.17 -13,235,701,254.02 13,434,552,965.83 Economic Infrastucture (Lands and Energy) Ministrics/Depariment 2,243,750,000.00 4,569,740,710.62 7,852,213,162.49 9,161,987,852.29 9,340,515,865.45 T Ectnomin ln Ifrastucture 2,243,750i,0. 00 4,569,740,711.62 7,852,213,162.49 9,161,987,852.29 9,340,515,865.45 Productive ____ ______ _______ _____ _______ _______ Ministries/Department 2,437,500,00.00 1,783,982,860.00 2,555,329,062.32 2,948,708,405.00 3,200,000,000.00 Total 15,350,000,000.0 20,106,493,181.53 28,800,000,000.04 32,000,000,000.02 32,000,000,000.10 Note: Based on domestic component Sourcc: Tlc Tanzania uthioritics 189 Table 13b: Sectoral Development Allocation 200012001 - 2002/03 Ministries/Departments (in percentage) 1998/99 1999/2000 2000101 2001102 2002/03 Budget Likely 0/turn Ceilings Projection Projection Administration Ministries/Department 1.3 26.6 22.8 17.7 15.7 Defense and Security Ministries/Department 0.0 3.6 3.5 3.1 3.1 Total Defense and Security 1.3 30.3 26.3 20.8 18.8 Social Sectors Education Ministries/Department 25.2 14.1 14.1 19.5 20.1 Health Ministries/Department 22.0 12,3 12.3 10.9 10.9 Water Ministries/Department 21.0 11.7 11.2 10.9 10.9 Total Social Sectors 68.2 38.1 37.5 41.4 42.0 Economic Infrastucture (Lands and Energy) Ministries/Department 14.6 22.7 27.3 28.6 29.2 Total Economic Infrastructure 14.6 22.7 27.3 28.6 29.2 Productive Ministries/Department 15.9 8.9 8.9 9.2 10.0 Total 100.0 100.0 100.0 100.0 100.0 Note: Based on domestic component Source: Table 13b 190 Table 14a: Sectoral Development Allocation 199912000- 2002103 Regions/Local Government 1999/2000 2000101 2001102 2002103 Likely 0/turn Ceilings Projection Projection Administration 996,941,588.73 1,894,813,398.76 1,663,400,622.18 1.506,232,792.20 Social Sectors Education 464,558,056.26 1,015,579,499.12 1,558,925,313.50 1,608,638,241.45 Health 404,615,081.26 884,536,983.11 875,000,000.00 875,000,000.00 Water 386,632,188.76 803,184,562.80 875,000,000.00 875,000,000.00 Total Social Sectors 1,255,805,326.28 2,703,301,045.04 3,308,925,313.50 3,358,638,241.45 Economic Infrastructure 748,537,900.33 1,963,053,290.62 2,290,496,963.07 2,335,128,966.35 Productive 292,222,003.13 638,832,265.58 737,177,101.25 800,000,000.00 Total 3,293,506,818.47 7,200,000,000.00 8,000,000,000.00 8,000,000,000.00 Note: Based on domestic component Source: The Tanzanian Authorities Table 14b: Sectoral Development Allocation 200012001 - 2002103 Regions/Local Government (in percentage) 199912000 2000/01 2001102 2002103 Likely Olturn Ceilings Projection Projection Administration 30.3 26.3 20.8 18.8 Social Sectors Education 14.1 14.1 19.5 20.1 Health 12.3 12.3 10.9 10.9 Water 11.7 11.2 10.9 10.9 Total Social Sectors 38.1 37.5 41.4 42.0 Economic Infrastucture 22.7 27.3 28.6 29.2 Productive 8.9 8.9 9.2 10.0 Total 100.0 100.0 100.0 100.0 NOTE: Note: Based on domestic component Source: Table 14a 191 Table 15a: Summary of Funds Requirements and Proposed Allocation Ffor Priority Activities In Some Sectors (in Millilons of Tshs.) 199912000 2000101 2001102 2002103 Requirement LikelyOlturn Requirement Prop. Allocation Requirement Prop. Allocation Requirement Prop Allocation Education 107,775.10 40,447.17 111,172.75 59,060.14 115,674.72 76,349.32 120,301.71 98,808.20 Health 46,680.00 24,724.70 55,760.00 41,613.62 62,180.00 56,840.86 64,667.20 75,048.04 Water 8,706.00 4,813.78 11,260.00 8,860.37 16,930.00 10,533.32 17,607.20 13,381.26 Judiciary 6,852.90 3,412.65 7,194.00 4,426.72 7,503.70 4,758.45 7,803.85 4,963.96 Election 16,174.00 13,800.00 31,406.00 32,000.00 - 3,943.62 - 4,100.00 Agriculture 15,252.00 6,059.87 12,443.00 7,258.80 13,120.00 8,122,53 13,644.80 8,891.20 Energy 5,382.00 2,580.12 5,435.82 3,538.39 5,490.18 3,743.64 5,709.79 4,145.46 Roads 46,000.00 46,955.61 50,000.00 41,337.17 52,000.00 43,554.65 54,080.00 45,114.S3 Lands 850.00 365.95 1,050.00 1,024.17 1,150.00 1,033.94 1,196.00 1,040.52 Controller and auditor 1,085.40 730.06 1,413.40 1,323.87 1,597.90 1,400.30 1,806.30 1,481.32 General TOTAL 254,757.40 143,889.89 287,134.97 200,443.25 275,646.50 210,280.63 286,816.84 258,974.89 Source: The Tanzanian Authorities 192 Table 15b: summary of Funds Requirements and Proposed Allocation For Priority Activities in Some Sectors (In Percentage) 199912000 200012001 2001102 2002103 Requirement I Likely0/turn Requirement Prop. Allocation Requirement Prop. Allocation Requirement Prop. Allocation Education 42.3 28.1 38.7 29.5 42.0 36.3 41.9 38.5 Health 18.3 17.2 19.4 20,8 22.6 27.0 22.5 29.2 Water 3.4 3.3 3.9 4.4 6.1 5.0 6.1 5.2 Judiciary 2,7 2.4 2.5 2.2 2.7 2.3 2,7 1.9 Election 6.3 9.6 10.9 16.0 0.0 1.9 0.0 1.6 Agriculture 6.0 4.2 4.3 3.6 4.8 3.9 4.8 3.5 Energy 2.1 1.8 1.9 1.8 2.0 1.8 2.0 1.6 Roads 18.1 32.6 17.4 20.6 18.9 20.7 18.9 17.6 Lands 0.3 0.3 0.4 0.5 0.4 0.5 0.4 0.4 Controller and auditor 0.4 0.5 0.5 0.7 0.6 0.7 0.6 0.6 General TOTAL 100.0 100.0 100.0 100.0 100.0 100,0 100.0 100.0 Source: Table 15a 193 煎！藝 c~_d lfebl. 16.: R- m E.P-W,e. hy m.W4i"u T- f- i. L-l a-*~~t Emolumørd. -re, and ofiter ch,ege, 'Oc« volt. ~17*2 P,.i.cil.n l r.W., e p Oc i m l Oc 101.1 28 87.758,33f1,40 207,579,025.12 87,754,33f140 222.410,5M.04 310.166,902.44 11.691.233.20 2,995.425.240.04 3.007,316,4r3,28 11.891.733 20 3,175,15D,754.48, N.187,041,94l," P'egidenre office amt cs"t 5.eft.dat 274,719,3n.40 0,045,744,~.92 2t4,719.383,40 7,0r1,2SS,141.21 Ad"d"" ded Mded ded ded ded m" P-Id~s OM- 172,661,235.CO 302ý215,4C9-78 414,87r,725.36 172,W1,235.130 320,349,479.15 40,DIV,714.75 ded P~d-r. om- - c" 5 -t 455<265,417.W _t_,? Ø.C'e," 1,657.811.283,16 455,28k417,60 t128e1010.1y4 78 1,742,175.642.38 33 46,411,785 00 159.057.426 se 205,469,211.56 4k411,785,00 3< Ad-W,trshn M" ky f Før~ Affidrs & IM, C ~ era 3.822.098,758 e0 P,017.105,072.32 3,822.09S,758 W 13,443,w.135.46 35 Ad."w1rødlion P.-a-I C~rntssi- vl F.4xdv 167,222143 20 148.145,3f1.41S 315,347.454.88 167.22ý,143.20 157,G34,030.33 324,25e,173.58 37 36 Adminitka" C l comm~ 46.925 38160 470,718.035M 517.844.416.6S 46.9213.381.60 4M,94%,I Il lit . Adnd..t,~ Pd.. MIrd.W9 Offit Ut,397,852 40 1,465,853,953.28 2,097.251,805.68 631,397,852,40 1,553,805,1110.48 2,185.203.W.M ý031 3,792,3:ý3,121 80 4,258,4"'ogo se 8X60,7K218.35 3,792.333,127,80 4.5111,91t0,27599 8,304,293.403ý79 Mbi-ry -1 j."t" ~ Con'ktutm"t Alfa" :57S,395,2m -ffi 4t07,5^735-72 IMSg74.021 92 379,395,268,20 1,2Å375,74US At2 ~ t, li.. Office of Le Sp-akw 2. tg 1, M1,137 80 3,25S.438.202,24 r,,450.169,340.04 2.191.751,137.80 3,453,ø44,494.37 . 55 Admilffiat.. 361.Pg2,B7& 60 361,992,678 60 1,431,315,264.79 50 A~ V." mird.ky f %~ VOTE SØ 488.»3,5e6 DO 4,15 t.n3.348 40 4,640,116,934 40 408,3g3,580,W 4,400,8M,749.31 4,80,220,335.31 Minigtry.fFinffice SPECIAL oAl 0.11 A~ ard ~wd,. offi,. 600,000,000 00 2,00 I.M.ma 00 2.061,2133,MS,00 600,0u1),Dæ 00 2j84,938,852 os Tam~ Reverfue Abority 25,1t12, flo'nøl m on 27,920,367.000.00 51 mkktry Qf ti.*. Affk. 1.487.714,W3 2Q 4,728,619.264.40 1,487.774,593,20 2,905.295.351.47 4,39ýpag,944.87 1,4 ~ 1*.11- R.d.T.m~ 360,503,838 40 064,024.193.18 i'm4,528,03f.fts 380.Wt,838 40 1,021,4d15,044.75 55 Adrni,,Å**hon T.m t. k~ nmt C*nVe 54,578.424 50 V 2,679.607 m 267,45a.431,66 54,573,42460 225.852.393,50 280,2»,so$. to 5ft MtM,by .1 Rg~ A~ h,~ ..d 10.1 0wemm-I 1.279,313.3194e 1,219,313,349 48 1,358,072,11a.85 1,36C,072,1111.65 57 Adý4,å'w b- Mål~ f VeV-.. ..d "Wh~ s~ . 145ýsV.161.80 145,527,w.tto ,ff Adindli**tn *w fktl~ C~ icn 101076.582 60 106.306.978.12 207,383.t,60.72 213,78t970.41 60 Adeftd**tko. immstdal Courl f Ismues 39:32,4,fflo 00 212,489,113 68 751.S13.713ýGC 39,324,SM.gø 225,7mAeØ.R) 2NIS83.0110,50 01 Ad~.b.lb. tl.tý41 c~ .~ 08,310,55~ 3,943.519,891«59 68.310.559,80 4,1D0,0m.00000 0 Locd Govemmer4 Servke C~m"m 51,453,778 20 212.678.204 W 2156,141,983'le 5ý,463,771t.20 60 t- p . d-fir, Offi. - M4ffi-tt C.Mmisyø,, e32,139,538 m 40,787.242,36244 41,419.381,901.24 632,139.538.80 1,234,4M,904,19 I.M6,614.442,99 Regl-I 4,SS6,704,770 45 4,13 1,985.95? 78 4,888.704,770,45 5,C38,994.W11,22 Locl G- t 6,99c,795,05 95 VOTE 33,35,55,59,60.63 150,113,Z43,438.20 Delffice ~ Secomt, U~c, sa,552,1 15,979,95 36.775.660,000,00 891W1715.979.05 42,553,"C,000,00 11k3,2M,341,979.05 39 V~ ve end Semty M* 14.5cal S.MM 7.W7,987,671,80 4,681."s,"00 12,V49,173,471.50 5.149,149,380,00 28 Ø~ce end 5~ P.It" F«" 22.121,W0.724 80 13,4105,4 t 7,170 60 35,fý28.W7,895.40 2Z121.SZ0,724.W 37,30T,4r#,ØIZ,46 29 D,to," end 5.wtty mhlsky of km. Aff.s - "son, 8,947,472,43L1t0 10.555,U2,703.00 19.503,105.134.80 6,947,472,431.1t0 11,St1,1k5,973,3D 4fi SdA .ýmcet M.W.tryf~ kon 13.3M,759.521 ýoo 12.145.413,ý% W 16,7e0,1 15.8M 48 W 50d29 s""t mifXisky o( fl.tm 4,079.413.653 OU 37,Coofi69,574.80 41.740.273.227 80 4,079,413^53.00 48.559,111.447.24 5Z634,531.1V0.24 ý 3 Sodl MI-Ilky ofc=murdty De, Gwd« edhve 978.305,655.M 759,025.837 M 338,733,5M 38 1,313,0W,243,98 135 s-ld ..-J-. ~btv of l~. " Ywib 0~ ent 1.038.011.300 40 2,075,5Ø1,158.00 1.03e.917^ 40 1.347,637M4M8 2,~,tU,315.28 (37 S.lild se"ACes T~hw. S~ e comed"" 73,231.357 20 »0,607,209.20 333,844,5W.40 73,231.351.20 336.162.371.96 412,0m.72D.18 SS Sodal mt~ t sd~ Ifth.a Nh. ttwbon 967,580,528.75 30,858,358,0W,75 967,586.628.75 38,858,000.265.50 4L, S-jffil M~ y 2.049.639.732o0 3,125.343.6rr.30 5, 114,143,~.30 Z,04R,639,73Z00 5,09z948,7M49 s..,al "r,,Icts Region% 9.142.1t87.242 15 5,508.998.9W1.22 14,fi51,S78,145.37 9.14Z6S7,24Z15 8.458,15^60707 17,01s,313,0w. 12 5-daf ""<"& tøcøl G,~ v35,801^ 875 90 3B,586,678.9».57 t74,358,3ý7,811.47 135,801,5m.an" 62,3f17,717,490,84 1V1.149.225^ 14 Z, t.t.i 17.1ý1211,963.4W2 47 Ec-omk 5~ 1 W 2.603.241,727 80 33.848.254,m.65 36.451,495.950.4ý 2,CO3.241.721,80 53 37,543^0,1 la.» 48 E,momk ~.40*t IA",fry el ~ 1& Hurn.n G~ l, Dw. 744,024,304 80 2,515,7^993.28 3,250.769.298 2.818,154.392,47 3,5$Z77$,697.2Y 56 C-omk «-4-, N0,4elly.r Em,,gy -d mi-.1. 502,3e1,OGS,40 1.915,593.469.44 2,417,958,10584 W2,384,895,4D 2.145.454.a85,17 ir 62 E.-mk ~ Mý m~ of C~ ca~s d I-lpd 1,717,371.217 So 6,058,10k344.64 7,775,M.602.44 1,M,371,211.80 6,7",400,190.80 8,50z777.408.80 -Nce$ Elecirknyml ý0 F.-offil. ~w,e. WN-" øf R-g~1 Adm. And L..d G-t, 275.148,98a60 275,146,9c8,60 15.7,33^ 381.65 16.OM«I?Z350,26 El- 41 ..,4~ L-algo- erd 669,933.770,24 i~,058,5".M 115.614.134312.21L f N~ l R~ m,. ..d T-fil. 7,620,220,9353M 215",755.9X4o 5,544,3%,1w4 3& 4,13k089,1t24JØ 43 o(Agdaftw¥ *hø Cývw~ s 3^6.786,788 CO 5 113,818.43000 5.41.200,21300 44 F1f-kwff" Nitd,by o( ~ %% m 1,4d. 424.672,882,20 1,541.561,03020 424,877,882.20 1,228.5T7.95ý 88 11,321,146,482.to 19,20Z393,0U.80 6,881.247,601.20 1z464,07s.120.16 Rf=tteerd 4~ 000,000 00 5.500.000.000.00 00 f~ wce 20.179,~ ýo 00 20,179,900,620.00 32,075,038.320.D0 C~ng-q 35,259,22 I.T50.435,25Q.22 $'750's .50 GRAND TO'tAl- ..348.81Z7 .17,20.73 1 2 34 0 6741.49 S-c, 195 r.bl. 106: RECURRENT EXPENDITHUNE BY MINISTRIESYE0PARTIMENTS INCLUDINO TRANSFIERS TO LOCAL OOVIE~M Tn pIlIrc-t91) PERSONAL IMOLUMIENTS PE AMD OTHER CNARES -DC v·./g 100 t00010 vote~ Mnsr/D!Fpamn ¯P 1KRsina irüa LikelyDKutur ..eing PE 0C ' Tta PE CC Total PE 0C 1T11 20 AdMink*.9.n VIc. Prvsdent' Of.. 002 004 003 003 0.07 005 003 000 004 27 AdmInitntlo Reg~*or ePoacel Purm 000 0 75 0.40 0.00 1.05 0 49 0.00 0.87 0.44 30 AdmoIl*asaon Premidenfl Oficc and Cabmnal Secretadat 0.06 1.0 1.3O 0.09 2.33 1.14 0.09 1.93 1.02 31 AdmirVsiEttn V0e.Presidn.f010e. 0.04 010 0.00 0,00 0.11 00 005 0.00 0.01 32 AdmIft0, Prt,ldenfs OfM- - CM Serv paten.t 0 13 057 040 0.15 0.41 027 014 0.34 0.25 33 Admild*agn ElicsSectarhat 0.01 003 002 0.02 0,05 0.03 001 0.05 0.03 34 Adml4*abon MiskryofF*ign Affära0.c.rndalon 1.53 329 2,60 1.27 3.17 2.1 621 262 1.93 35 Adminl*aMoN Permanent Cm"domisslEnq.*y 0.03 004 0.04 0,08 005 0.05 005 004 0.05 30 Admini*öon cmvi s~neca Commissdon 0.01 003 0.03 0.02 005 0.03 001 0.14 .0.06 31 AdOdniraol Pdm#e Mwiste.'s Ol3k. 0.23 1 26 0.0 0.21 0.51 0.35 020 0.42 0.31 40 AdmiroIaon Judici"ry 1.25 0.73 093 1.26 1.34 130 120 1.3 1.22 41 Adnistrpamon MahTYOfJultma ndCons%StoialAfflls 0.11 052 0.3 0,13 0.28 020 0.12 0.2 0.18 42 Adminiagon Offce of gh. Spear 070 1 11 0.95 0.73 1.14 092 0.09 0.94 0.02 45 Adm0.0ason EuAcquer -nd Aidt Deprnent 0.11 0 18 010 0,12 0.29 020 0.11 0.31 0.25 50 Admk.Saon Mnkyo.Finanna VOTE60 031 1070 0.64 030 1.45 0.87 0.15 1.20 0.09 Minfiky ofFince SPECIAL 0.00 1679 10.23 0,00 0.00 002 0.01 0.00 0.00 AccounnGenerars omice 000 0 DO 0.00 0.00 0.41 019 0.19 000 40 TananI. Reven- AböOrly 000 0.00 0.00 0.00 823 3.81 000 7.07 3.50 51 Adb~ntraon Milnky f Hovn* Affk. n 37 1 25 091 0,49 0 om 0.71 0.47 079 0.03 54 AdmInl*aon R4d. Tenranal 0.13 0.27 021 0.13 0.34 023 012 028 0.20 55 Admkij*aar. 7nzbh -enentCank. 0.02 0.13 009 0.02 .05 000 0.02 000 0.04 5 AdwInl,sIon M1.n.1cy of l Adsraon and L~cl Gd~ .vern~G M 002 014 0.10 0,00 0.45 021 0.00 0.37 0.19 57 Ads1s044o.n Miy of Defent. and aHåonal S. 004 052 0.33 005 020 0.12 0.05 0,17 0.11 59 AdmdWl*acmn La Refkrm Commison~ 001 002 002 003 0.03 0033 0.03 0.03 0.03 60 Administan Induffiml Courl of Tnanitvla 001 003 002 001 0.05 003 001 0.00 0.04 a1 Adni*hn Eeiol.91Connmon 002 045 020 0.02 541 2.56 002 9.81 4.00 63 Adminl*abcn L. o ~iovemitS~rv* ComMI11si 002 004 003 0.02 0.06 004 0.02 0.06 0.04 66 Admind*alon PreidenrS Offim0 • P~anning Com~issiun 0.17 0.55 040 021 0.27 0.24 020 0.23 0.21 Admjitiraion Regloni 1.38 1.59 151 1.62 1.10 1.42 155 1.41 1.48 Adnistionll Lo91lenent 216 0.00 084 2,98 000 1.58 2.05 0.02 1.40 VOTE 33.35,55.50,60,63 0.00 00D 0.00 0.00 000 0.00 0.00 0.00 0.00 sub.To1. 4.90 42.174 20.02 10.07 21.4 19.41 9.82 31.4 20173 38 D~0nce ano 50e.my uefence 17.10 1011 127 16.90 1269 14.92 to01 1080 13.36 30 D0.ecändS-Mily TheN6N l..Swie 247 1.03 2.00 2,44 1.53 2.01 2.33 1.30 .1 28 Defence and Sec~Y Pole F~rce 035 3 45 537 733 452 6.01 7 02 3.5 .40 29 D).fmncand Seou^y MiskyofHmneAffar.Pkison- 3.8 232 2.92 297 345 320 2.03 294 2.80 ~ 4o1l 31.87 17.71 23.24 29.64 22.19 20,14 2..17 11.89 23.40 40 So~ s MIlNbry . Educaon 4 13 2 15 293 4.43 2.3 3.46 4.23 2.00 3.03 52 Soc]idsrie Minkhy of Hieii 1.07 000 4 11 135 7.29 4.13 1.29 040 4.03 53 Sodi seMees MMIsky of CormiSty Dov. Gdeir CJkt 0.32 0.30 0.31 0.32 0.00 0.20 0.31 0 0 0.18 65 Sodelsc~s MöktyofLabouandYoulh Developwin 0.33 032 032 0.34 026 0.30 0.33 0.24 129 67 Sol eM..s Te~ch. S~-e, Comnison 0.02 0.02 0.02 0.02 006 004 0.02 0.06 404 68 Social anms Minhby of Sdc,. TechA. Highe Edutagmn 020 438 2.75 0.32 7.52 3.70 0.31 7.16 3.79 49 Social aemces MhiymoWatff 0.73 1.00 090 0.00 0.39 0.54 0.65 0.74 0,00 Soolsl ~eM *e Regions 300 50 2.04 303 050 1 87 2.89 1.32 2.o Sodåd gemcnr .cplOovemffiffil 42.33 202 1778 45.02 5.81 26,58 4300 8,3 2.63 3vT.tal 2.70 17.30 3f,13 90.62 24.27 40,3 5303 2,73 41.11 47 Economwkici, c. 2/ MiiryofWorkt 0.84 929 5.99 0.86 1.77 0.9 0.2 '.90 .43 48 Eoomic er MIIyII of Land# & Humal Setlement% Dev. 0.22 0 71 052 0.25 0.7 0.0 024 0.0 0.47 58 Eemo,1ceeMoes MinislryofEnargyandMråis 0.15 054 0.39 0.17 0.51 0.33 0.6 0.52 034 62 E-onmk0senfece Mh-ky.rC-aNmniconasandTrn.p«rt 00 2.52 1.83 0.57 1.00 1,19 0.54 1. 1.11 E-onomi M E.ckte"y I 0.00 0.00 0.00 0(1 M.00 0.00 0.00 0.00 0.00 5 Eco mic serswea Miktry o Regional Adm And Loal Gov. 00 3 35 204 0.00 4.70 229 000 3.70 1.97 Econmk Mdes Lom go ement 000 0 11 0 26 0.55 0 21 0.39 003 0.15 0.35 uolat 2.32 1c63 11.04 246 11.94 10t 2.38 10.74 5.17 69 Plod.~v Minlsby of N.lro.I Resources and Tour,m 085 1 97 1 53 0 16 63 1 22 002 1,40 1.11 43 Prodel MiriIyoflAgicltur. .n4 C-operahves 327 2.73 295 1.28 168 1.47 1 22 4 44 0.33 4 Iproductve Minky of Ind.shi.. aind Tred% 009 092 0.59 0.14 0.36 024 0.13 031 0.22 5u.Total 4.22 0 02 6,07 2.26 3.07 2.03 2.10 3,1 2,07 Sararylnerease 000 0.00 0.00 0.00 000 0.00 0.00 00 0.00 Reavitment1 0.00 0.00 0.00 0.00 000 000 0.70 000 0.30 n..,fan. .0 00 0 00 0.00 0.00 0.00 3.00 0.00 0.40 cRn~ngn~y 0.02 00 0.00 000 . 0.0 054 0. 0A1 00r11In-t 100.00 00 . 10000 100.00 100.00 1000 100.00 100.00 100. Source* Table 16 196 . .CorInued Tatle lth: Recorint Expenflare by fnstriesiDeprtments InclucIng Tiansfers to 0.oca Gæernmt, (in per~9rt.ga) Peronal Emoluments "PE and Other Char ges -GC Vot. 2U01112 202J03 WNtrlyMD par~mer4 Projecn ojp.etion 26 Adnisration VICE PRESIENT 00; 0 0! 004 0 0 005 0.04 27 Aninitaiont Reg,rar d Pld P.es 0.00 0.7E 041 00C 0,78 040 30 Adm t4n. Preaident's 0Mwe and Cabinet Scetaiiat 0.0 1.73 0.94 0.07 I 73 0.91 31 A~nVnisation Vice P-edtnt',Ofice 0.05 0.0 000 004 08 006 32 A U-aton Pred. ofi - cvi SeW5 cN. Departt 0.13 01 0.22 011 0.31 0.22 33 At,itr"e Ethic Sereiadt 001 0.04 003 001 004 0.03 34 A~ninr-o0n Mirtr ol Foreig AMak.r & kr* Co-~patir 1,07 23 I 74 09 2.35 l 07 35 AdiIlton Permnen* ComrionocdEnciry 0.00 0.04 00 004 004 0.04 36 Ad~.r0ratløn CMSr.Commisson 0.01 0.12 00 001 02 007 37 Adniron P-me M.iter' Offi 0.1 0.30 020 0.0 03. 027 40 ;Ani4nitrt.n Judicdary 100 010 10 0. 1,10 103 41 AdtiMrNon M M initoJuteandCot,ituboaAfl-s 011 02t 01 b1e 021 015 42 Adkiitrfn Offikth. Speak. 0,61 0.85 073 005 0.84 0.70 45 Adnin~straban ExcheVpjet and Audit Dpartmln 010 0.35 0 23 0.09 030 022 50 Ad-Ødønsaon MiniiyofF~na VOTE 50 014 1.0j 06 012 10 061 MZZ,kyf nn SPECIAL 000 000 000 0." 0.00 000 AouotGenera'Ofice 017 053 036 010 0.5 035 T=nai. Re- Adh.ry 000 6S 342 0.00 683 3.47 51 Adrenistralon Minsy of 00me Nfa7. 0.42 071 007 03e 071 0s 54 Adninifr.ton R.dio.r n~. 011 025 0l 010 020 017 55 AT~w4. Tanza,s ir0estmert Cetr 0 0 006 004 001 006 003 ,S Adiionm Mini«kyo RonalA dni ond Loca[lovemn 0.0 0.33 017 0.00 033 0l7 07 Ad W.nistatimo M-n4tyo Dfen-ana o-dn-Iserv-c 004 015 0.10 004 0.15 0.09 59 AdInistraton L» RdørmtC~omsn 003 003 003 003 0.03 0,0 60 Adiisdo ai 1r4ktria Co1 &f fTnzai 001 0 00 0.03 001 0.06 0.03 61 AOir7stralon Elto1C~onni,.on 0.02 102 054 002 1.00 0,5 63 Adnin*straton loxal Go -ert. Servic Co-nteslan 0 01 006 0.04 0.01 0.06 00. 66 AZd"or,stra- Prdt,l 1-vaIngComrni,ion 018 1058 558 0.16 0.30 0,23 Adn,inron Region- 1 37 1 230 123 130 1 31 Adrronotr L- -realGo,.errmer4 252 000 121 227 00. 1,12 VOTE33,35,55,59,60,63 020 000 000 000 00 0,00 Sub-Ttkl 0.61 31.07 20.22 7.26 21.1 14.r1 30 DO meen eclty Defence 14t7 1006 1203 127 104 11.07 39 Defnc and S.ocn0y Th. NationaW Se--c0 200 1.21 1 0 1 .2 1.5E. 29 Defence .nd Ser8-dy P4-c Forc. 020 300 4.4 5.0" 3.71 4.63 29 .~fen d ec-rKty MIisty o4om N - Priso 21 2 642 2d 284 2,5 Sub-Tolta 24.04 17.61 21.10 22.44 1.25 20,31 40 Soc-alsew-ces M'ityoEducatry 374. 315 344 337 411 3,74 52 So-ia sM... M"tøry of HeAth 1.14 9 7 6 1.03 11 E654 53 Soil<eices MItriyof Com,ty 1e 0ede, & CUlture 027 0 07 0 17 020 0 016 65 S0 -1-0ser,ke Miitry of LabourardYVoulDevdopmert 020 027 0.20 02 033 0.3 67 S-cid --wrces T..c,h', S-rv.ceCormússion 0C02 0.07 004 0.02 0.0 005 60 SW kl.rv,e Minisry o cna, 7h.& HIg. Ec..on 0.27 7 715 41e 0 24 2 0 4 95 4 I Soc-alseric.s M~iistyo 00ate 057 0.01 0.70 07 724 08 Soc-ai10senne Region 256 1 3 .97 2.312 07 219 Sociaiervice LocalG-verr~ert 3606 1001 23.49 34 1200 23 Sub-Total 44.04 $.$3 30.17 42.4 420 4217 47 Eoomie services 2/ M~niry ofwarks 0.73 170 4.91 006 6.5 466 40 Econ-omi i MiNisry of<Lads 0umn St 0etsDe 0 21 0.65 0.44 0 I 0.69 0.44 51 Eoomic es Mnstry f Enegy n,d Miat. 014 050 033 01 0.62 0.33 2 ~Eoos.e M.ni.y of Co mrmca.ons.od t-~r,pot 00 7 1.01 0e 0 l. 1 0. Econ,om, -,w1e Electrilityt 000 000 000 0.00 0.00 0.00 56 E-conoi -k.'ce M yiniy f R.onal Adm. And Io..a Go. 00 339 000 70 385 1 99 Ecoomic sennees Local govemment 0.47 017 0.31 0 4 0.1 030 Sub-Totaf 2.10 16.67 6.84 1.8 16.46 8.79 60 Praective Mir~stry (o Naural Reworce and Towlamr 073 1.31 1.03 0.65 3 101 43 Pro0ctive Ministry of Agnc" . and Co-opea.ti-e 10 0.34 1.22 0.0 1.39 119 44 ProNcflve Minityof I1nk,i ad Trad. 012 0.29 0.21 0.11 0.30 0.21 S~b-Tht. 1,00 2.54 2.46 .74 .O6 2.40 Sar 0rrea00 0.3 000 3.99 140$ 0.00 o2 Recrui~mer 1 12 0.00 0.54 1 3e 0.00 0.6 1ris. ac 566 0,00 2.7 0.0 00 3.9B C~nbngency 049 0.00 0 24 0.4 00 024 GRAND TOTAL 100. 100.0 100.0 00 10.6 10.0C Sour.e Table 1.4 197 Rl61 t69l9'01?U tt I8U'ti'66 L 9 9 £0 5 1a t 98Pt6t6s 69ot?9'tLGE t909 ' 00 tt LgG te t t0O tt eertteL6 ttIt 19 6 a t 9lzl~E.a It elg%1tr sEtt 6l9l9C tttwi et l st 6 6 tatC , Vet e t e atot6 tt g '0 tett - La eate at t tt 19 e a 00t b t tt t 990 t at 99 £ - tt tit9t taL t l66t 9 .tt ae te 91, C%Wgwl' 099t12 990991 '2100,61 0 00 Us .94zP 1 9 ' 119igtC a £ Z, 0'1.19t GCE 9L?S.et 910099.99916 2 GE0L999 GLI tt It-'604 ý eteM 99 IZSlles't ll l; I b'Z4 69 It tEZ L S9 et Z ýe^ 'I,"L18ý I L96%£6 BL ÅSV'ICK6OL "C 406 SL1E 1 9 C690 E K IC (tI t 119650 966"CgE 119C99£ .96L6CC19 9C 06"LE t a 6960t 9g act 6CC Zas 9 et 00 6ô65tu 91e bu D$99,900'9 d GD96l t9 899 9u -D11.1Z19'SC 6P9LIGZa 9 166 :'9869t G6918l'99E 9095 et CC' u (,1 IES 1 ä,9595 D5inte0 ¯69C LGS "9"CS'G m 69. 06co 9SE e w ."c- tZt0tet '68sa tttste t 9Itta92atte00 tt aL6'0ttL t t ittaLO tt teatet tt et0et sa at e t tte t t ea' t tatt t attEUW 60t 9/£'19 Þ02is CLZ la t tlatitaZt2i tt eL9-L'tt e0tfteatt ti0^,, te tt to set199 t et et tvege 9e ett te tit t et i a et t ea I9z0 Sst li t t9 0 Ot9t9ta tZ1 at E ttG " 9 att ta 2 l tat ti e etttel 6et6atv tst a 490tro V866t 08t ge989'60 98 0Q 8&9 0'äi;w 19 892L 9£ ge 0Owe Ntt W'9 tcC8'So'S6 £0 6869 9090Q9 06o6 a9 91 0G 6% Qtt 081,L409S6t 1':9 601ttWtIeoaate eot Et ,e 9 ette'ek et, Gtea tt l 90 att a 9 IE S etta te a tt e l ti E at:t leI tt ottia 1 6a tt t 9 att at e' a 9a 6 1tatt'9l t e t t ttLtL teet'6 6 ltou tt K 961.Co vue' G LE¥90 8'6 ng6bl g .S1oQ O' G1 1 tg6, 60 J Zl "t 6 81 1 09 8 OlLaZ0 it -6 6 0 9 9 G. 996( 1 1 l Lit9, et13,6t t i6tt L1196, - -0 '9 - 6 " . "t L i e l,,e Z tel Oe C1taate t$ cea '1 oe9 ef.v tatt at 00 OL ti ote 51 CI .0~; 91 ea t ett at 1, 5 9 ot e att >59 oI ta U et9G2 taso ett at et .a1a att at att att RGAZ s9 sIt tt taa att ett Z"tt hi tt tkV«g tt t1 9 OJLZG 90 1 tt 1 L.Ud tt E, tt "d tt - e Ud D l0'tt I t E6 0t ' 6 6 t 8o LZt6o9 ttt9tty L€ i 9tL t6 "tG e. t _ e9 -t t 8t1t2 1 1.M 1 i CS,L6IZ'D,Zk 809st06 .1c4 me6~ . ekt 96 £ .6£_4Qkl/ZZ u'. C__ '9V_ 6_699_r - a ..6 c, i u9W8gea L-.I % aLsn l 9 gi67'99 6__ ,______ __e_ 1o 10 1 IKWKtI 9t _ee 4 I t 00@to8'09188L Q w0090 08'DE e 9 9£9 '. t¯9 0 '001601 kL099a t'86 00'0E0gG0'0€ t, 'Lqm900'k99 00 0~5 Z'98 i)'oec9 00¯0 9 o o ,OLz DON ¯gli Õ Dø'OE 000w ItDLg9i I I ¯ 0O8 9 c 000t 0008els n k t,l eIet t ss 0000booe 9ot,teetta 0tsgmt e ee949g6le 00w0oits 00D -- *D L9 0 00-1t tt eges0 C 0s0att 'est 00t Ie1096C 00 000tt 0, 9c at iaa 00t aet'tt, tCa6 a' W, .0E t 6E t atett at att 0 et at i .n;taa' a 0t0 DN' taUt Pot%'tyci at Mt~tt eWa5Ekt La ta att too 00 9t uaLt 96Le i a 6 0tt o0 t at 1 E9t t t L 00 000t9t0 ac I e a Lt 6 6 a t 00t t at966 t 000i at 0a0ta 0L att as0 00t0a94e' 000a't'at et.a t 00t BILt6a6 0000 L'eet et a6t 0000as tt6t leat 00e 00'ut '1t t 99*6'0 t toGt1t tt 0£L£999 000 L ta a0 0t au tl ta 0Dm 16t9tl 000at et at 0ta1 9t 0 09VsCe9go69 00 000'006'9n 90 9tL '9n 000ec50s 1 a 995h 91E 1 000009tCC": ES D, 616 00 000'91C 1S9 000 " 't 0000c54,6#90 000DG0Dc 'at, 00000ft epoe 95,11 t a 4 9 t 9 9 9 9 0 0 Q u500 9 a z 6 t i69 0 0 e 0 0 a a t00 6 t891 e 0 0 tt L a9 9 t 0 0 a0 0 9 t Z Z t 9 2e tt 9 e 0 0 0 0 0* 9 6 0 6 6 t i0 0t 0 i t ' K 0 0 0 C t t 9 E 0 0 0 0 gt t 6 C L 0 t a 0 0 « Y e ctI i s I t ,009MCst M 00 000 001 zE 99560M6£91 000OL496 t E66 en lt9 PO gUlylSt1 M9il9Le~9 000WM-j7g,, 000 t 1 000CC66 000000" h0e0mem% '91 GU VAVZ no C'GV S61 0000Z 6 iÞ 100 m0r00W0CL 099,9v9299 0000o9o9'9 90 9699ccEE wcE 0000OG 1 090 1 0w000 00 9 , 0006c6 '19 00u06'e '94 c 0000='LE6'6 t WL IG 000, Lo'Li 000/£i £r¿45' 0000L , 9 L,f9;9 ., 000 o 9196i 9Listk0£98 D 6 0000tii 0000Vt 000 ms,6 00Oortoi 'SE 000 '9tt ¯u 2n590i 00 92,110 0000t01 9Do9'90 000e005 I69'tc9 0z06fç 00G99,LC :009tE 000190 00066£9 100 16 0000999D0£s, G" 1 UDLUESL 000961 4910' W0000 GOL 96'LSq6699 00 004t0991* 90ZU 90 Z 0000DCeL0 0 000'0 ,00 Ni9 0000Ef9 0000 UTL (oCste 1ý 1L 00'9 f9 00000sh Iit Iç5 00000t0 £69'991 000¥9€; 6LQS9 00B 6 L 0006S 0001¥0'k 000€n6Et 000L69t 19 008 m.11:110'1 00,04 ,10 ý 19 99 1,6082 . 0000 09k 6 9,61tbc691 0000ot£€66029 1660 '6 0k0L6k 9% 00409051'95 J000'M M0S 0000 M,56 00 00,tí0 eggeu DEL 900 SL9 L' 000069 n Oi >6gir EK 000000669 "b04t k>EGLE D0ag66it 1L69LL9/L 00 0090 L ozeob DOOO o080 D 0000Lsen 0000nsotkfDl 000SSis L, 00 00'K Sl 00000C69 Ost OC6' 94K 2 00009OCEC 1 ¿¥960 000 ots, m9t'9(A 00å9.,E9 m0o. , 0009'G96Z9 0£0009et 0't 000 9 eSt 000O0,04E6 Do I 00 hi961 000610 z9]6969 6000tt 0999QL 00'99 t 9 216189 09000CL ý009t 00016C 1001 "'9 u 0000909 t,9 De9Cg''CCAi 0000000S'U 01£96916% w000'06S 1 99E kk 0000,,G101091 ccoi976 000 U9 0 k00009 n0006 9£ 0000LDGo 9töi 00 004 49L 'W f- L 00099i,a9e . 1 00 0006 _9P 0 5 tr k _0 01C9 S G ôf t 9. g _OL izg0_£ l l99 _st 6 00000069 00000t L 0 09 6'1 L te011 0 00A Gn loez g m ks st O 0056 v41 0 00 009S'6 _.__ _ __, 1 ta mol g at 1 0taZe t te lt t a at at at -a ta et ta a t attaa it a .ttno at at te_ UO a t t ta atE at tit1tte000 tt __ _,_0t uka atetaeo a ttata at att att tt:G ta at it t e t at 00c ta aal tet to tO, t99te6t oao,.q t0al t alt uta e it OM ta c at attC att ta Ut t et tt 1 att, tLttC tt tt .a2 tt2t tat ct/tt tt tt e_t at a tt a t tt tt_ZE _4t t t9 at . ._.tt. t e to i a t t a t ut at a tattet etuti ...Continued Table 17a: Recurrent Expenditure-Regions 2002/2003 Administration Health Education T PE OC CPIR 0 PE OC 70 Arusba 339,367,Z93. 366,088,52506 709, 928,361,77 326,839,446.47 10,714,891.79 273,150,8534 2,026,089,2 71 Pwani 310,341,262.48 248,066,45528 222,738,872.38 174,624,689.18 14,300,253.94 149,602,585.39 1,119,674,118.65 72 Dodoma 281,587.391.58 269,512.540,24 495,426,379.14 326.311,090 34 16.271,796 48 296,487,68381 1,685,603,881.59 73 fringa 293,196,551 02 280,737,215.81 637,306,338 39 250,980,173 00 8,328,654.59 263,492,980.27 1.734,041,913.08 74 Kigoma 185,823,479.86 2t8,481,718 29 397,141,746 61 212,398,142 60 9,825,852.12 174,243,011.21 1,197,913,050.70 75 Kilimanjaro 308,552,751.08 253,223,076.47 628,020329,15 246833,839.76 10,203,99858 252,815,462.41 1,701,649,457.43 76 Lndi 226,958,422.87 224,488,611 19 359.810,487.67 1 7,225,846 70 6,878,690,86 137,869,049.28 1,153,232,108.56 77 Mara 254,683,093.29 300,203,084.19 435,131,517.07 59.625,707 47 8,444,39024 202,960,254.16 1,261,048,046.42 78 Mbeya 243,449,610.47 345,080,370 87 387,756,651.43 281,88,589.39 9,816,129,90 304,021,787 34 1,572,011,139.40 79 Morogoro 313,412,844.00 234.250,85570 629,662,511.04 522,372,58423 11,824,918.56 203.576,85149 1,915,100,565.01 80 Mtwara 206,645,096.43 275,468,616 47 380,267,776.61 184,794,207 20 8,412,367,96 126,345.543.46 1,181,933,608.13 81 Mwanza 311,255,560.21 392,779.978.88 598,254,981.11 89,463,148.20 10,922,016 48 289,541,430.43 1,692,217,115.31 82 RUvuma 166,338,345.00 274,193,66262 487,231,22377 121,633,55985 15,111,70043 130,242,250.81 1,194,750,74247 83 Shinyanga 254,889,154.94 416.131,688.81 582,732,326.49 190,634,737.02 9,565,562.78 247,730,147.86 1,701,683,61789 84 Singida 201.046,969.48 232,541,237 87 343,078,507 46 136,347,761.08 4,333,786.85 146,082.524.55 1,063,430,787.30 85 Tabora 229,635,993.94 261,509,278.32 512,151,311.31 345,590,944.69 3,275,907 35 168,223.707.19 1,520,387,142.80 86 Tanga 262,961,975.90 283,260,626 25 590,440,781 92 241,457, 181.30 9,510,686.58 248.200,075.98 1,635.831,327 93 87 Kagera 253,385,267,51 278,547,924 95 301,517,758 75 77,242,292 16 10,109,02133 237,281,433.96 1,158,083,698.67 88 Dar es Salaam 126.840,055.51 265.343,940.24 . 11,511.744 63 3,054.075.29 144,167,024.78 550,916,840.45 89 Rukwa 116.333,357.84 219,084,62173 257,691,460.69 319,217,476.82 5,493,216.87 153,591,987.66 1,071,412,12162 Total Regions 4,886,704,776.86 5,638,994,029.22 8,956,289,322.78 4,318,999,162.07 186,397,918.96 4,449,626,645.81 28,137,011,855.79 Source The Tanzanian Authorities 199 -E,―닉， 「 ... Continued Table 17b: Recurrent Expenditure-Regions (Percentage) 2002/2003 Administration Health Education TOTAL PE 0C PE 0C PE 0C 70 Arusha 6.9 65 7.9 7.6 5.7 6.6 7.2 71 Pwani 6.4 4.4 2.5 4.0 7.7 3,6 4.0 72 Dodoma 5,8 4.8 5.5 7.6 8.7 7.1 6.0 73 fringa 6,0 5.0 7.1 5.8 4.5 6.3 6.2 74 Kigoma 3,8 3.9 4.4 4.9 5.3 4,2 4.3 75 Kilimanjaro 6,3 4.5 7.0 5.8 5.5 6.1 6.0 76 Lindi 4.6 4.0 4.0 4.6 3.7 3.3 4.1 77 Mara 5.2 5.3 4.9 1.4 4,5 4.9 4.5 78 Mbeya 5,0 6,1 4.3 6.5 5.3 7.3 5.6 79 Morogoro 6.4 4.2 7.0 12.1 6,3 4.9 6.8 80 Mtwara 4.2 4 9 4.2 U 4.5 3.0 4.2 81 Mwanza 6A 7.0 6.7 2.1 5.9 7,0 6.0 82 Ruvuma 3.4 4.9 5.4 2.8 8.1 3.1 4.2 83 Shinyanga 5.2 7.4 6.5 4.4 5.1 6.0 6.0 84 Singida 4.1 4.1 3.8 3.2 2.3 3,5 3.8 85 Tabora 4.7 4.6 5.7 8.0 1.8 41 5.4 86 Tanga 5.4 5.0 6.6 5.6 5.1 6.0 5.8 87 Kaged 5.2 4.9 3.4 1.8 5 4 5.7 4.1 88 Dar es Salaam 16 4.7 0.0 0.3 1.6 3.5 2.0 89 Rukwa 2.4 3.9 2.9 7.4 2.91 3,7 3.8 Total Regions 100.0 100.0 100. 100.0 100.0 100.01 1 0.0 Source: Table 17a 201 TAble 18. Recurrent Expenditure-District Counclls 1998/99 Educt1i,on Rett Ro-d, Water Administralian Total PE OC PE OC PE PE OC PE PE PE OC Ausha 3,926,671,175 17 480,871,70000 532,371,20000 42,946,10000 64,668,60000 27,351,900.00 101,870,500.00 30,147,500.00 314.887,400.00 4,940,668,875.17 581,317,200.00 2,176,078,43222 127,727,300.00 442,191,000.00 32,649,40000 45,508,800.00 12,894,100.00 54,503,900.00 26,545,100 00 18,241,30000 163,171,000.00 2,899,694,432.22 199,815,900,00 Dodoma 3,08,948,87000 104,070,10000 465,406,50000 32,349,0000 24,988,900.00 6,907,800.00 63,976,70000 21,349,300.00 8,003,200.00 124,567,900.00 3,768,892.07000 164,677,000.00 Iringa 4,081,820,570 06 108.789,500.00 51,325,200 00 35,640,900 00 39,722,100.00 24,240,200.00 68,244,900 00 24,214,100 00 168,178,900.00 4,876,291,870.06 192,884,700.00 K igom a2,609,617,06235 148,520,000.00 433,768,200 00 26,000,000.00 31,514,100.00 13,568,200 00 43,453,200.00 23,867,600 00 6,787,400.00 123,842,500.00 3,248,982,462.35 211,955,800.00 Kilimaja. 5,324,782,746.75 133,776,60000 862,098,90000 57,306,60000 57,639,200,00 23,366,40000 151,575,300.00 37,097,1000 11,171.600.00 283,455,200.00 6,691,022,946.75 251,546,700,00 Lindi 1,R99,334,797 52 101,633,70000 350,676,30000 25,902,90000 28,335,20000 8,451,600.00 37,458,100.00 23,110,80000 125,856,100 00 2,441,660,497.52 159,0900.00 Mra 3.603,256,187 50 145,403,700.00 418,870,500.00 30,355,000 00 39.21I,300.00 7,026,400.00 35,916,400.00 14,616,900 00 11,299,700 00 149.074,900.00 4,257,628,987.50 197,402,000 00 Mbeya 4,909,109,705 13 173,618.600.00 696,267,900 00 55,111,000 00 61,649,200.00 18,665,000.00 63,703,900.00 20,720,000 00 22,922,700.00 239,061,100.00 5,992,714,405.13 268,114,600,00 Morooro 3,596,877,991.21 129,645,300.00 534,608,800 00 38,975,600 00 61,524,400 00 10,474,500.00 61,639,000.00 9,852,600 00 11,544,000.00 238,576,600.00 4,504,770,791.21 188,948,000.00 Mtwra 2,647,728,170 72 102,987,900.00 392,392,600 00 22,859,100 00 17,299,100.00 7,858,500 00 33,911,100.00 31,682,800 00 3,573,700.00 93,477,200.00 3,188,381,870.72 165,388,300,00 Mwn 4,832,027,492.44 148,487,600.00 825,993,200.00 24,955,900.00 40,826,100.00 11,848,600 00 96,515,200.00 12,285,600 00 9,000,000.00 191,241,700.00 5,995,603,692.44 197,577,70000 Ruvuma 2.861,598,938 82 82,546,900 00 474,802,200 00 26,937,600.00 67,933,300.00 5,829,700 00 64,083,300.00 35,914,500 00 5,181,800 00 142,549,600.00 3,616,149,138.82 151,228,700.00 shmnyang 3,837,541,115.68 163,976,000.00 662.99R,700 00 35,277,500 00 38,227,600 00 9,900,000.00 53,80,800 00 27,893,900 00 184,762,500.00 4,777,410,715.68 237,047,400,00 Sm.gida 2,189,542,382 63 110,908,700 00 442,986,100 00 25,731,300 00 36,745,500.00 3,854,400.00 8I,237,100 00 7,057,900.00 5,526,300 00 87,909,300.00 2,843,946,682.63 147,532,300.00 Ibora 2,507,220,836 71 96,588,000.00 519,392,600.00 17,620,000.00 39,375,100.00 9,491,700.00 61,736,500 CO 12,644,000.00 12,359,500.00 133,641,00000 3.273,725,536.71 136.343,700,00 Taga 3,712,455,025 57 138,967,200 00 636,692,100.00 48,104,000 00 53.265,400 00 21,019,100 00 75,693,800 00 15,575,700 00 10,389,400.00 198,963.600,00 4,687,459,325.57 223,666,000.00 Kagera 4,33,048,864 24 155,769,900 00 538,132.400 00 24,847,400 00 31,100,400,00 8,820,900 00 51,968,800 00 92,017,500.00 9,248,900 00 144,691,000 00 4,908,190,364.24 221,455,700.00 Rukwa 1,892,020,415 63 68,138,900.00 413,114,400 00 16,640,500 00 825,911,800 00 8,742,200 00 54,840,700 00 9,050,000.00 6,381,000 00 109,529,700 00 3,301,798,035,63 102.571,600.00 Toi.aDuincts 63,822,680,80036 2,722,427,600.00 10,161,288,70000 620,210,60000 1,605,446,300 00 240,311,200.00 1,256,509,200.00 415,642,90000 151,630,500.00 3,217,437,200.00 80,214,992,700.36 3,998,592,300,00 Sou,rce Tanzanian Authorites 202 ...Continmed I Able 18.: Recurrent Expenditur-District Cøancils 1999/2000 r~d.~llo llil IlRoads Wter Administr.ion Totgi PE OC PE OC P OC PE OC PE PE PE Oc Arma 5,445,48151600 1,614,655,40000 747,305,729.00 133,949,600,00 93,070,271,00 29,411 000.00 163,753,682.00 50,050,500.00 604,346,917.00 7,053,958,109.00 1,828,066,500 00 P'wan 3,558,486,400.0 428,668,700 00 024,922,758.00 101,327,100 00 70,133,122 00 26,116,500 OD 99,099,114 00 65,310,800.00 436,941,636.00 4,939,583,110.00 621.423,100.00 4,249,730,98600 349,707,400.00 805,47S,25200 67,154,900.00 36,641,215.00 33,645,5000 107,273,36300 69,793,50000 212,534,03100 5,411,665,847.00 520,301,300.00 l,mga 5,586,914,143,00 427,738,900.00 724,993,51900 87,649,000.00 89.365,915 00 28,662,500.00 127,932,66600 30,851,100.00 336,950,937.00 6,866157,180.00 574,901,500.00 3,539,170,87800 528,907,00000 533,662,96200 74,466,00000 46,139,99300 10,207,40000 59,442,934.00 60,536,900.00 193,559,181.00 4,371,97.5,948.00 674,117,300.00 7,406,763.82200 472,553,500.00 1,308,879,248.00 178,092,400.00 80,580,05I.00 51,870,500.00 167,188,809 00 65,182,80000 600,384,302.00 9,563,796,232.00 767,699,200.00 L.di 2,579,484.226.00 308,633,300.00 593,665,975 00 104,296,100 00 40,125,020.00 14,680,800 00 112,838,940 00 83,609,900 00 232,468,997.00 3,558,583,158.00 511,220,100.00 Mar4 4,892,075,207.00 432,774,700.00 551,02,791 0 96,061,100 00 59,561,232.00 8,018,600.00 53,118,075.00 s9>321,300.00 241,231,065.00 5,798,188,370.00 626,175,700.00 Mbya 6,749,226,900.00 720,537,100.00 947,724,422 00 67,954,600.00 06,040,950.00 18,863,700.00 85,036,755.00 24,225,400 00 360,276,022.00 8,228,313,049.00 031,580,800.00 Morogor 5,063,374,627 00 455,145,500 00 795,510,769.00 79,953,900 00 106,519,34,00 20,435,000.00 82,709,142.00 36,287,500 00 540,20,858 00 6,588,374,780.00 591,821,900.00 Mtwara 3,952,498,07500 38J,353,500.00 538,200,299.00 65,735,90000 24,370,866,00 12,195,900.00 52,818,25000 60,771,100.00 150,497,109.00 4,718,384,59900 520,056,400.00 M w a 6,569,264,616 00 48,970,900 00 1,118,852,823 00 76.689,700 00 76,057,943 00 11,511,300 00 133,18,599 00 39,100,00 00 452,467.217 00 8,350,461,218.00 616,272,700.00 Rivuma 4,475,433,864 00 319,161,200.00 652,878,703.00 105,222,10100 45,92,461,00 5,077,50060 87,423,789.00 45,016,000 00 234,511,607.00 5,496,240,424.00 478,576,800.00 Shinyaga 5,370,91),672.00 594,865,100.00 876,552,726.00 95,153,00000 53,744.374,00 8,775,000.00 87,429,092 00 49,836,300.00 281,185,948.00 6,669,823,812.00 748,629,400.00 S ingida 3,140,609,164 00 226,268,800.00 607,220,196.00 142,971,700 00 49,825,313,00 6,093,900 00 83,649,814,00 95,070,000.00 179,093,250.00 4,060,397,737.00 471,204,400.00 T.bor. 3,271,,09,146 00 309,131,200 00 649,434,330,00 69,280,900 00 47,438,143,00 9,707,700 00 77,001,063.00 34,310,800 00 220,172,82 00 4,265,655,494.00 422,430,600 00 Tanga 5,012265,578,00 488,762,200.00 965,234,688,00 118,811,800 00 86,639,352 00 35,470,300.00 I14,783,241,00 39,164,700 00 588,094,687.00 6,747,017,546.00 6R2,209,000.00 Kager 5,716,234,29400 499,668,8000 06 710,532,61900 142,959,40000 39,722,925.00 12,689,200 00 69,235,417,00 64,574,600.00 247,551,709.00 6,703,282,014.00 719,892,000.00 Daresaaam - -- R.kw 2,354,224,05900 213,131,800.00 558.274,63900 66,173,00D.00 64,885,861 00 15,654,00000 67,091,09800 30,273,300.00 164,436,683.00 3,208,912,340.00 325,282,100.00 TotlDaincts 88,934,167,26700 9,260,685,000.00 34.511,127,44800 1,876,902,20000 , ,196,867,441 00 360,686,300 00 1,831,643,843 00 1,033,587,300,00 6,276,964,968,00 112,750,770,967 00 12,531,860,80000 Source. Tanano Authnties 203 ..Continued Table I8a: Recurrent Expenditur-Disrict Councis 2000101 Educlin1elt Road, W.we Adminlstration Total E OC PE c OC PE OC PE PE PE OC Arsha 5,217,755,5385 50 2,700,199,067.67 784,671,015.45 439,744,357,19 97,723,78455 39,508,662 10 171,941,366 10 114,022,802 91 634.64,262,85 7,406,656,014.45 3,293,474,889.86 Pwani 3,736,410,804 00 716,865,545.48 866,168,895 90 332,647,655 95 73,639,778 10 35,083,063 26 104,054,069 70 148,788,133 50 - 458,788,717,80 5.239,062,265.50 1,233,384,398.19 [)oma 4,462,225,935 0 584,818,033 27 845,752.164.60 226,463,430 52 38,473,275 75 45,196,990 60 112,637,031 15 159,000,419 47 - 223,160,732.55 5,682,249.139.35 1,009,478,873.85 4mga 5,866,259,850,15 715,310,634.69 76L,243,194.95 287,743,69735 93,834,21075 3 8001 3,39299.30 70,283,59147 - 353.798,48585 7,209,465.039.00 1,111,841,103.52 3,716,129.421 90 884,494,727 66 560,346,110.10 244,465,10704 48,446,992.65 13,711,90090 62,415,0070 137,912.44877 203,237.140.05 4,590,574,74540 1,280,584,184.37 Kimnjaro 7,777,102,013 10 790,254,391.20 1,374,323,210.40 584,66[15582 84,609,053.55 69,679,169.60 175,548,249.45 148,496,52965 - 630,403,517,10 10,041,986,043.60 1,593,091,246.27 LindI 2,708,458,437.30 516,129,540 03 623,349,27375 342,394,61298 42,131,271.00 19,721,150.81 118,480.887 00 190,476,32189 244,092,44685 3,736,512,315 90 1,068,721,623.71 M.r 5,137,098,96735 723,732,036.85 579,392,930.55 315,359,856,77 62,539,293.60 10,771,621.45 55,773,97875 203,487,777.05 - 253,292,61825 6,088,097,788.50 1,253,351,292.09 Mbeya 7,086,688,245.00 1,204,959,030.66 995,110,643,10 223,088,77290 90,351,397.50 25,340,163 52 89,288,592.75 55,189,219.08 378,289,823.10 8.639,728,701.45 1,508,577,186.16 lo-o 5,316,543,358 35 761,142,875.91 835,286,307 45 262,481.383.74 111,845,353.20 27,450,937.06 86,844,599.10 82,668,553.97 567,273,900.90 6,917,793,519.00 1,133,743,750.68 Mtwara 4,150,122,978 75 637,740,018.80 565,110,31395 215,804,98254 25,589,409 30 16,383,111.49 55,459,16250 138,445,99270 158,021,964.45 4,954,303,828.95 1,008,374,105.53 Mwanza 6,897,727,067 80 8t7,709,319.46 1,174,795,464.15 251,765,311 95 79,860,840.15 15,463>468.16 140,509,528.95 09,077,687 77 . 475,090,577.85 8,767,984,278.90 1,174,015,787 34 Ruvuma 4,699,205,55720 533,735,417.90 685,522,638.15 355,283,31401 48,292,08405 7,895,418.77 91,794,978.45 103,236,877.48 - 246,237,187.35 5,771,052,443.20 1,000,151,028 15 Sih.,yanga 5,639,457,255 60 994,796,901 19 920,380,362 30 312,178,647 04 56,431.592.70 11,787,715.82 91,800,546 60 113,534,22 08 - 295,245,245.40 7,003,315,002.60 1.432,498,086.12 smgida 3,297,639,622.20 378,390,833.61 637,581,205.80 469,363,091 13 52,316,578.65 9,260,778 81 87,832,304 70 216,584,207 39 - 188,047,912.50 4,263,417,623.85 1,073,598,910.95 Tabo- 3,435,189,603 30 516,962,18.55 601,906,046.50 227,442,9521 4n,810,050.15 13,00,639,18 80,851,116.15 78,165,324.74 - 231,181,452.60 4.478,938,268.70 835,611,04068 Tanga 5,262,879,85690 817,360,30905 1,013,496,422.40 390,048,33622 90,971,319.60 47,648,298.16 120,522,403 05 89,223,261.88 - 617,499,42135 7,105,368,423.30 1,344,280,205.31 Kage 6,002,046,008 70 835,599,489 47 746,059,249.95 469,322,71135 41,714,373 75 17,045,775.90 72,697,187 85 147,110,955 70 - 259,929,294.45 7,122,446,114.70 1.469,078,932.43 .aresSalaa, - - - - - - Pktkwa 2,471,935,26195 356,505,355.63 56,18S,37095 217,239,94210 68,130,154.05 .21,028,42902 70,445,65290 68,967,27344 - 172,658,517.15 3,369,357,957,00 663,741,050.19 ,rtal Desrct 93,380,875.630 35 15,486,705,718.07 15,236,683,820 40 6,161,699.261 80 1,256,710,813.05 484,520,524.61 1,923,226,035 15 23,54,672,200 94 6,590,83,216 40 118,388,309,55.35 i24,48759,697.42 Som~e Tanzanian Authontie 204 .. ind bIe 8 Reurr nt Epo8Enditur- id Coundi, 2001/02 Education __ _HeaIth IRoads Wate~r Admiiraion Total PE QC . PE OC PE OC PE OC PE PE PE oc Armha 5,717,755,585.50 3,355,938,28.22 784,671,01545 745,066,66676 97,723,78455 44,249,701.55 171,941,366.10 141,713,066.ó5 - 634,564,262.85 7,406,656,014.43 4,2M6,967,714.68 Pwam 3,736,410,804.00 890,955,246.47 866168,89590 563,610,825.63 73,639,77810 39,293,030.85 104,054,069 70 184,921,104.10 - 458,788,717.80 5,239,062,265.50 1,678,780,207.05 D..o- 4,462,225,93 30 726,840,197.94 845,752,164 60 373,535,102.00 38,473,275 75 50,620,629.47 112,637,031 15 197,613,428.08 - 223,160,732,55 5,682,249,139.35 1,148,609,357.50 5,866,259,850 15 889,022,727,98 761,243,194 95 487,529,251 86 93,834,210.75 43,123,561 61 134,329,299 30 87,351,854.13 - 353,798,483.85 7,209,465,b39.00 1,507,027,395,58 K,gm 3,716,129,421 90 1,099,292,919.08 560,346,110.10 414,201,568.40 48,446,99265 15,357,329.01 62,415,080.70 171,404,275,96 - 203,237,14005 4,590,574,745.40 1,700,256092.46 Kffiimajao, 7,777,102,01310 982,166,461.09 1,374,323,210.40 990,61.769 91 84,609,053.55 78,O40,669.96 175,548,249.45 104,58,68469 - 630,403,517.10 10,041^986,43.60 2,235,367,585.68 [.md, 2,708,458,437.30 641,470,809.20 623,349,273.75 580,125,26788 42,131,271.00 22,087,688.91 118,480,88700 236,733,205.25 - 244,092,446.85 3,736,512,315.90 1,480,416,97124 Ma 5,137,098,967.35 599,489,254.76 579,592,930.35 514,319,800.75 62,539,293.0 12,064,216.00 55,773,978.75 252,904,472 39 253,292,618.25 6,088,097,788.50 1,698,777,743,90 Mbeya 7,086,688,245.00 1,497,581,487 0 995,110,643.10 377,9826619 90,351,397.50 28,380,983.14 89,288,592.75 68,591,836.50 378,289,82310 8,639,728,701.45 1,972,537,573.62 Moogoo 5,316,543,358 35 945,985,258.85 835,286,307 45 444,726,865 6s 111,845,353.20 30,745,049 21 86,M44,599.10 102,744,485.83 - 567,273,900,90 6,917,793,519.00 ,524,201,659.87 Mtw.r 4,150,122,978.75 792,614,206 69 565,110,313 95 365,642,210 92 25,589,409.30 18,349,084 87 55,459,162 50 172,067,39022 - 1s8,021,964 45 4,954,303,828,95 1,48,672,892.72 Mwn 6,897,727,867 80 1,016,288,776 68 1,174,795,464.15 426,570,435 10 79.860,840 15 17,319,084 34 140,%09,528.95 110,710,067 97 475,090,577.85 8,767,984,278.90 1,570,888,364.09 R.v- 4,699,205,557 20 663,352,247.57 605.522,638.15 601,962,822 71 48,292,084,05 8,842,869,02 91,794,978.45 128,307,795 24 246,237,187.35 5,771,052,445.20 1,402,465,734.54 Shinyang4 5,639,457,255.0 1,236,381,806.71 920,380,362.30 529,28,684.21 56,431,59270 13,202,241 71 91,800,546,00 141,106,579.92 - 295,243,245.40 7.003,315,002.60 1,919,959,312.3 3,297,639,622.20 470,282,468.66 637,581,205 80 795,250,213 21 52,316,578 65 10,372,072.27 87,032,304.70 269,181,350.81 188,047,912.50 4,263,417,623.85 1,545,086,104.94 T.hr 3,435,189,603.30 642,505,656.43 681,906,046,.50 385,360,532.6 49,810,050 15 14,605,515.89 80,851,116.15 97,147,654 27 231,101,452.60 4,473,930,268.7 ,139,19,5.45 Tanga 5,262,878,856 90 1.015,855,009.62 1,013,496,422 40 660,865,816.68 90,971,319.60 53,366,093 94 120,522,403 05 )10,890,994.53 617,499,421.35 7,105.368,423.30 1,840,977,914.77 K.ger 6.002,046,008.70 1,033,523,547.12 746,059,249 95 795,101,797.03 41,714,37375 19,091,269.01 72,597.187.85 182,836,626 23 259,929,294.43 7,122,446,114.70 2,035,633,239 38 Rukw. 2,471,935,261.95 443,082,135.83 586,188,370.95 368,073,488.38 68,130,154.05 23,551,89650 70,445,65290 85,715,870.28 172,658,517.15 3,369,357,957.00 920,423,391.00 TotalDistn,s 93,380,875,63035, 19,247,628,498.69 15,236,683,820.40 10,439,876,386.22 1,256,710,813.05 542,662,98756 1,923,226,035 15 2,926,500,74253 - 6,590,813,21640 18,358,309,515 35 33,6,668,61500 5ourc- Tanzanian Authonie 205 ,Cetnue Table18s; RecurrentExpnitur-U11strätConais 20102103 EP OC PE OC PE OC PE OC PE PE PE OC ÄriisÏ 5,717,755,58.50 4,363,218,196.36 784,671,015.45 1,125,641,972.70 97,723,784 55 49,559,665.73 171,941,366.10 184,248,033.56 - 634,564,262.85 7,406,656,014.45 5,722,667.868.35 Pwan 3,736,410,804 00 1,158,374,147 23 866,168,895.90 851.499,644 14 73,639,778 10 44,008,194.56 104,054,069 70 240,424,900 25 - 458,788,717.80 5,239,062,263.50 2,294,306.886.18 P>doma 4,462,225,93530 945,000,2N 38 845,752,164.60 564,334,452.01 38,473,275 75 56,695,105.01 11 2,637,031.15 256,926,06 53 223,160,732.55 5,682.249,139.35 1,822,956,572.93 itinga 5,866,259,850.15 1,155,861,586.17 761,243,194.95 736,556,987.26 93,834,210 75 48,29R,389 01 134,329,299.30 113,570,384.07 - 353,798,483 85 7,209,465,039.00 2,054,286,446,51 Kiir,a 3,716,129,421 90 1,429,244,064.45 560,346,110 10 625,773,090 32 48,446,992 65 17,200,208 49 62,415,080.70 222,851,016 13 - 203,237,140.05 4,590,574,745.40 2,295,068,379.39 Kilimjao 7,777,102,013 10 1,276,962,273 16 1,374,323,210 40 1,496,594,842.09 84,609,053 55 87,405,550 35 175,548,249 45 239,953,701 20 630,403,517 10 10,041,986,043.6" 3,100,916,366,80 Lind, 2,708,458,437 30 834,007,324 76 623,349,273.75 876,449,558.26 42,131,271 00 24,738,211.58 118,480,987.00 307,788,327 01 244,092,446.85 3,736,512,315 90 2,042,983,421.61 Mara 5,137,098,967 35 1,169,469,629.51 579,392,930 55 807,246,950.38 62,539,29 00 13,51I,921 92 55,773,978 75 328,813,376 09 - 253,292,618 25 6,088,097,788.50 2,319,041,873.90 Mbeya 7,086,688,245 00 1,947,078,35R 56 995,110,643 10 571,054,710 12 90,351,397 50 31,786,701.1I 89,288,592.75 89,179,574 87 - 378,289,823 10 8,639,728,701.45 2,639,099,344.66 ior.ooR 5,316,543,358 35 1,229,921,33652 835,286,307 45 671,890,514.95 111,845,353.20 34,434,455.45 86,844,599.10 133,583,091.43 567,273,900.90 6,917,793,519.00 2,069,829,398,36 itwara 4,150,122.978 75 1,030,516,189 67 565,110,313.95 552,409.922 49 25,589,409.30 20,550,975 05 55,459,162.50 223,713,163 15 138,021,964.45 4,954,303.828.95 1,827,190,250.37 Nza 6,897,727,867 80 1,321,326,351.35 1,174,795,464 15 644,459,895.32 79,860,840.15 19,397,374.46 140,509,528.95 143,939,531 29 - 475,090,577.85 8,767,984,278.90 2,129,123,152.41 Rv 4,699,205,557 20 862,456,444.52 685,522,638 15 909,441,596 95 43,292,084.C5 9,904,013 31 91,794,978 45 166,819,190.39 - 246,237,18735 5,771,052,445.20 1,948,621,245.17 Shy-aga 5,639,457,255 60 1,607.479,979.13 920,380,362 30 799,615,755 69 56,431,592 70 14,786,510.72 91,800,546 60 183,459,51 .39 - 295,245,245.40 7,003,315,002.60 2,605,341,756.94 singida 3,297,639,622 20 611,437,056 74 637,581,205 80 1,201,458,954 93 52,316,578 65 11,616,720.94 87,832,304 70 349,975,735 52 - 188,047,912.50 4,263,417,623.85 2,174,488,46813 3,435,189,603 30 835,352,779.86 681,906,046 50 582,200,237 60 49,810,050 15 16,358,177.79 80,s51,116 15 126,306,379.15 - 231,181,452.60 4,478,933,268.70 1,560,217,574.41 5,262.878,85690 1,320,762,389.75 1,013,496,422 46 998,431,864 1 90,971,319 0 59,770,025.21 120,522,40365 144,174,762 69 - 617,499,421.35 7,105,368,423.30 2,523,139,042.56 Kagera 6,002,046,008 70 1,350,234,855 26 746,059,24995 1,201,355,592.20 41,714,37375 21,382,22129 72,697,107.8R 237,714,769.44 . 259,29,294.45 7,122,446,114.70 2,810,687.438,19 D.eSalaamI-- Ruk.wa 2,471.935,261 95 576,72,584.21 586.188,370.95 556,083,08095 68,130,15405 26,378,12408 70,445,652.0 11,443.362.09 - 172,658.517.15 3,369,357,95700 1,269,977,151 33 l'al D.knets 93,380,875,630 35 25,024,775,752 61 15,236,683,820 40 15,772,498,723 "5 1,256,710,8I3.05 607,782,546 06 1,923,226,035 15 3,804,885,66.26 - 6,590,813,216 40 118,388,309,515.35 43,209,942,638,18 Source Tanzanian Anthorities 206 0.0b 0s0: Recuroto Epedko40.D3rk3 C.onel 19999( Percenta) ?E oC VE - uC PE DC pE uC PE FE Pr oc Ärlisb 6.2 177 32 6.9 4,0 114 81 7.3 0.0 90 6.2 143 F.-nt 34 47 4A 3.3 28 54 43 64 120 5.1 36 3.0 Dodoa 4,8 38 46 52 16 29 51 51 5.3 3.9 4.7 4.1 1ringa 6.4 40 51 57 23 101 54 5.8 00 52 6.1 4. K... 4.1 55 43 42 2.0 56 3.5 357 45 3, 4.1 3.3 K1nnan0o 83 4-9 85 92 36 97 121 89 7.4 9.8 L3 6.3 3,nd. 37 33 4.2 1.0 35 30 . 00 39 3.0 4.0 Mar- 10 53 4.1 49 24 29 29 33 7.5 4.65 3 4.9 Mib.ya 7.7 64 69 09 38 74 51 50 15.1 7 7.5 6.7 Mor0golo 5.6 48 53 63 38 44 4.9 24 7.6 74 5.6 1.7 M3aa 4.0 38 3.9 3.7 11 33 27 7.6 2.4 29 4.0 41 M7, 1 3 3 91 40 23 4.9 7.7 30 5.9 3.9 7.5 4.9 Ruv3mb 4.3 3. 47 4.3 4.2 2.4 5.1 4.6 34 4.4 4-5 3.8 Shinyan'a 6.60 05 5 7 24 4.1 4.3 6.7 0.0 5.7 6.0 3.9 singuia 34 4.1 4.4 41 2.3 11 .35 L7 36 2.7 3.' 3.7 T.bor 39 35 I1 20 23 39 4.9 30 8.2 4.2 4.1 1A 3.4 51 63 7.8 33 87 60 37 6.9 .2 5.5 3.6 Kager0 63 3 7 3.3 4.0 1.9 37 4.1 7.7 6 4.5 6.1 .5 Da esSalam 0.0 0 0 0.0 0,0 0 0 00 0.0 0.0 0.0 0.0 0.0 9.0 Rukw- 3.0 25 4.1 27 514 3.6 4.4 22 4.2 3.4 4.1 26 Tk.i D'stnt 100.0 1009 00 1000 IDD 100 1000 1000 00.0 10.0 100.0 Meo. Il.-s Tota Loaov 77 .05.923.000.36 3,332,138,900.00 13,m68,512.00 00 83704.900.00 1,994.24,20000 296.671,40000 1,3Z4,507,500 00 430,764,9000 192.570.00000 4.596,200.60000 99,662,337.30.36 4,397.100.100.00 Urban Counc l as a... na Qf Toaw LoØj Govn 82% 82% 74% %4% 85% 81% 95% 96% 3% 70% 50% % Sour,c Tab,l.s ..,Continued Table Ib: Recu-rent ExpendKtur"-istrict Camncds 2000/01 (Percentag,) Educ*tion Health Ro.d Water AdmdWi-tato Total PE 0 PE 0C PE 0C PE 00 PE 0 EC PE D Amsha 0.0 0 0 0 0 00 0 00 00 00 00 00 0.0 P9I.. 0.. 0. 0 0 0 0. 0 0.0 00 00 0.0 0.0 0.0 Dodoma 0.0 0.0 0 0 0. 0.0 000 00 T0 0.0 00 iga 0.0 0.0 0.0 0.0 1.0 0. 00 0 . 0 0.0 Kgoa' 0.0 00 00 0.0 00 0. 00 00 0.0 0.0 0.0 K6manar0 0.0 0000.0 00 00 00 0. 0 0.0 D.0 L. 0.0 01 00 00 .0 00 0.0 0.0 0 0 0.0 0 Mara 0.0 0 60 0 0 02 00 0.0 00 00 0.0 Mbeya 0.0 0.0 00 0.0 :0 0.0 0.0 0.0 00 0.0 0.0 morogoro 0.W- 00 0 0 0. 00 0.0 0.0 00 00 0,0 0.0 Miars 0 0 0 c G 0 0 0 0 02 02 00 0 0 0.0 c 0 Mwana 0.0 00 00 00 0 0 0 0 0 00 0.0 0.9 0.0 Ruuma 0.0 00 0000 .00 0 0 0.0 0.0 0.0 shinyanga 0 0 0 0 020 0 0000 0000 .00 0..0 Singid. 0.0 00 0 00 0.0 00 0.0 0.0 0.0 0.0 0.0 Tabora 0.0 0.0 30 0, 00 0 0 00 0.0 0.0 0.0 0.0 Tanga 0.0 00 0.0 0.0 00 0.0 00 0.0 0.0 0.0 0.0 121.9 122 4 1365 350 117.4 123. 105.4 103 6 142.9 124.2 122 5 Dat es Salao 0.0 00 00 o: 0 0 00 00 0 0 0.0 0.0 0.0 Rukwa 0L0 00 0.0 0.0 0. 0c 00 00 0.0 00 0.0 TotalIsinets 0.0 00 000 00 0.0 00 0.0 00 00 0.0 Memo Items: TotaM Loca1 vt. 113.207,102,218 35 18.955,201,697 01 20,585563,92795 7.413288,57559 i.663,058,557 05 598,155,152 00 2,008.842,711.75 2,440,340,338.24 2,361,003 75 8.988,436,049.00 14Ø,455,362,469.45 20,406,995,762 83 _U 00n Coun-ffa 9aPecenag o Tta l - - f W - Sorce: TUabk 180 207 -Continued Table 18h: Recurrent Expenditute-District Councils 2000J0 (Percentage) Education Health Roadt Water Administration Total PE 0C PE 0C P6- 00 PE 00 PE CIC PE C Antsha 6.1 17.4 5.1 7 1 78 82 8.9 4.8 96 6.3 13.4 wapI 40 4 6 5.7 54 5.9 7.2 54 6.3 7.0 4.4 5-0 Dodoma 46 3.8 56 36 3 1 9.3 5.9 68 3.4 4.8 4.1 Ina 6.3 4.6 50 47 75 7.9 70 30 5.4 61 45 Kigoma 4 0 5.7 3.7 4.0 3.9 2.8 3 2 5.9 3 1 3.9 5.2 Kilimaram 83 5.1 90 95 6.7 14.4 91 63 9.6 8.5 6.5 LInd, 29 33 4.1 50 34 41 62 a.1 3.7 3.2 4.4 Mara 55 47 38 51 50 2.2 29 86 3.8 5.1 51 Mbeya 76 7.8 6.5 36 72 5.2 4 6 23 5.7 7.3 6.2 Morogoro 57 4 9 5,5 43 8.9 5.7 45 35 8.6 5.8 4.6 MIwara 44 4.1 37 3.5 2 D 3.4 2.9 5.9 2.4 4.2 4 1 Mwanza 74 53 77 4 1 6.4 3.2 7.2 3.8 7.2 7.4 4.8 Ruvuma 50 3.4 4.5 5.p 3. 16 4 E 44 37 4.9 4.1 Shinyanga 60 6.4 60 5 1 4 5 24 48 4.8 4.5 5.9 5.8 Singlda 35 2.4 4 2 76 4.2 1.9 46 9.2 2.9 3.6 4.4 Tabora 3.7 3.3 45 37 4.0 2.7 42 3.3 3.5 3.8 34 Tanga 56 5.3 6.7 63 72 98 62 38 9.4 6.0 5.5 Kagera 6.4 5.4 49 76 3.3 35 38 62 39 6.0 60 Dares Salaam 00 0.0 00 0.0 0.0 0.0 00 00 0.0 0.0 0.0 Rukwa 26 2.3 3.8 35 54 43 37 2.9 2.6 2.8 27 Total Distncts 1000 1000 100 0 1000 100.0 100.0 1000 100.0 100.0 100.0 100.0 Memo Items: Total Local Go. 113.207,102 218 35 18,955.201,697 01 20,085.563,927 95 7,413.288,575 59 1,863,058,557 65 598 155,152 00 2,008,842,711.75 2,440,340,338 24 2,361,003 75 0,968,434,049 00 146,455,362,468.45 29,406,99.762 83 Urtan Councilsl 0 82 082 074 083 076 0.81 096 096 - 073 0.81 083 Source: Table 1ia ...Continued Table 18b: RecuientExpenditureZistrict Councils 2001102(Percentage) Education Health Road. Water Administration Total PG 00 PE 0C PE 0C PE 0C PE 00 Pr Oc A;ruha 00 0.0 00 0.0 00 00 00 00 0.0 0.0 0.0 Pwani 0 0 0,0 0 0 0 0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Dodoma 00 00 G0 00 0.0 0.0 0.0 00 0.0 0.0 0.0 Iringa 00 00 0.0 00 00 00 00 00 0.0 0.0 0.0 Kigona 0.0 00 0.0 0.0 0.0 0.0 0 0 00 0.0 0.0 0.0 Kilimanjaro 0.0 00 00 00 G0 00 0.0 00 0.0 0.0 0.0 Undi 0.0 00 00 0.0 00 D0 00 0.0 0.0 0.0 0.0 Mara 0.0 00 0,0 00 0'0 00 00 0.0 0.0 0.0 0.0 Mbeya 00 00 0.0 00 0.0 00 00 0.0 0.0 00 0.0 Morogoro 00 0.0 00 00 00 00 00 0.0 0.0 0.0 0.0 Mtwara 00 00 00 00 0.0 0.0 0.0 00 00 0.0 0.0 Mwanza 00 0,0 00 00 00 00 0.0 00 0.0 0.0 00 Ruvuma 0.0 0.0 00 0.0 0,0 0.0 0.0 0.0 0.0 0 00 Shinyanga 00 00 00 00 00 0.0 00 0.0 0.0 60 0.0 Singida 00 00 00 00 0.0. 0.0 0.0 00 0.0 00 0.0 Tabora 00 0.0 00 00 0.0 00 0.0 0.0 0.0 00 0.0 Tanga 00 00 00 00 0.0 0.0 0.0 0. 0.0 0 0 0.0 Kager. 121 2 122.4 135 1 1203 1323 123.5 104.6 103.6 136.4 123.7 120.1 Dar as Salaam 00 0'0 00 00 0.0 0.0 0 0 0.0 0.0 0.0 00 Rukwa 00 00 00 00 0.0 0.0 0.0 0.0 0.0 00 0.0 TotalReglons 00 0.0 00 00 00 00 0.0 00 0.0 00 0.0 Memo Hanms: Total Local Go 113.207,102,21835 23.558,443,429.61 20,585,563.92795 11,995,412,250.05 1,663,058,0S7.65 669.933,77024 2,008.842,71175 3,032,973.25591 2,361,003.75 8,88,434,049.00 146,465,362,46845 39.256,762,705.81 Utban Coucils - - - - - - - Suce: Teble 18a 208 ...C<mtinucd Table 18b: Recurrent Expenditure-District Councils 2002103 (Percentage) Educali,,m Hea1th Roads Water Administration Total PE OC PE OC PE OC EO PE OC PE Arusla 6.1 174 5.1 71 7 8 82 8.9 4.8 9.6 6.3 40 46 57 54 59 72 54 63 7.0 4.4 Dodoma 48 318 56 36 31 93 59 68 3.4 4.8 ringa 63 4.6 50 47 75 79 7 0 30 5.4 6.1 Kigona 40 57 3.7 40 3.9 218 3.2 59 31 3.9 K ounanjaw 83 5.1 90 95 6.7 14,4 91 6.3 9.6 8.5 Lindi 29 33 41 56 3.4 41 62 81 3.7 3.2 Mar 5.5 47 38 51 5.0 22 2.9 86 38 5.1 Mbeya 7.6 7.8 6.5 36 7.2 52 46 23 5.7 7,3 Morogoro 57 4.9 5,5 43 8.9 5,7 4.5 3.5 8.6 .A Mtwar 44 4.1 37 3.5 2.0 34 2 9 59 2.4 4.2 Mwz 74 5.3 7,7 4.1 6.4 3.2 7.3 38 7.2 7.4 Rivima 50 3.4 45 58 3.8 16 4.8 4.4 3.7 4,9 shinyang, 60 6 4 6,0 5 1 4.5 2,4 4 8 4.8 4.5 5.9 Singid. 3 5 2.4 4,2 7.6 4.2 1.9 4.6 9.2 2.9 36 Taboma 37 3,3 4 5 3.7 40 27 42 3.3 3.5 3.8 I mga 56 5.3 67 6.3 72 98 63 311 9.4 6.0 Kagera 64 5.4 49 76 3 3 3.5 38 62 3,9 6.0 Dar es Salam 0.0 0.0 0.U 0(0 00 0.0 00 0.0 0.0 0.0 Rukwa 2.6 2.3 3.8 3 5 5 4 43 3.7 2.9 2.6 2.8 Total Regions 1000 100.0 1000 100( 10030 1000 1000 100.0 100.0 100.0 Mfeo Itn.: Total Local Go 113,207,102,218.35 30,629,475,415 45 20,585,563,92795 17,794,926,37& 18 1,663,058,557 65 750,325,822.67 2,008,842,711.75 3,943,315,697.20 2,361,003 75 8,988,434,049.00 146,453,362,468.45 Urbai Coumcils 082 082 0.74 0 89 0.76 0.81 096 096 - 073 0.81 Source: Table 18a 209 Table19: RECURRENT EXPENDITURE-URGAN COUNCILS 199Ø/99 Educaion Heath R..d. Water Admi.tanon Tl0, PE Ot PE OC PE OC PE 0C PE DC PEC 7 Aroha 116.830,6M000 19,965.000 241.&68.500 00 700.00000 10.356.400 00 4,0n5.00000 71.389,700.00 960,425,0.00 3l,Ë30,00 2 Dodom. 994.876.900 00 22.725.100.00 251.935,20000 9.313.90000 12.503.300.00 3,000,000.00 14,433,90000 ,4 11,000 00 76.52190.00 1.252.37.300.00 4,450,0.00 3 i,n0a 432.701.20000 15,509.70000 - 94,867.10000 10.40.20000 8.247.20000 4.640,000.00 6.952,80000 44.733.60000 587.501.00.00 30.629.900.00 4 Kigoma 347,77.900.00 18,824.500.00 78.242.60000 5.30000000 11.436.10000 2.600.00090 2,451.90000 19,292.90000 459.191,400.00 26,724.00.00 5 Lind. 152,654.4000O 10.196.00.00 73.029,30000 14,198,00000 17.130,40000 2,921.70090 27.19,00 270.433.100 27.315,700.00 6 Mo,hi 487.005.700.00 13.518,00000 174,735.70000 10.73320000 1.162,30000 4,502,000.00 2,059.90000 55,5m0.90000 737.49.800.00 28.753,209.00 7 Musoma 991.855.40000 37,918.50000 113,008,40000 6,86220000 7.100.00000 1.713,500 00 2.919.40000 80.687.700.0 785.779.90.09 48.492,200 9 Mbeya 931.829,200,00 19,31 40099 128.233,80000 8.300.00000 13.370,00000 3.080.00000 3,351.10000 53.229.40000 1,030,013.500.00 30.761.400.0o 9 M.o9oo 736.413,40000 23.484.600,00 127,152.00000 14.30,70000 l8,091.90000 4,99,70000 2.312.0000 51.220.100.00 935.19t.900.00 42.64.0W,00 70 M1war. 22,563.600.00 12.012.90000 79,924,900 00 5.248.70000 10.014,200 00 2.83,40000 1.80.900 00 12,34.30000 330,787,500.00 20.075,000 i1 M.n'a 023.776,60000 22,405,00000 211.552.100 00 3,000.00000 1.489.30000 2,000.00 00 72,95.10000 1,109,774.700.00 27.401.00.00 12 songe. 509,400,500 00 43.899,300.00 59,506,700.00 15,484.000 00 8.123.600 00 995.300 00 2.121.800 00 41.813.200.00 519.971.800.00 50,378.00.00 13 shnyanga 373.72.700.00 27,117,70000 62.641.00000 7584.00000 7.311.500.00 1.650,000.00 36.253.400.00 479.929.800.00 3.351,700.00 14 S"0Id4 351,999.900 00 26.803,900 00 80,928,900.00 11 194.700 00 5.106,000 00 229.000 00 1.300.000 00 36.583.900.00 475.918,100.00 38,227.0009 15 Taboma 707.291.000 00 90,300,000 00 126,120,200 00 7 310.00000 16.102.900 00 4.055.100 00 1.740.000 00 2,559,400 00 85,129.100.00 937,202.800.00 10.405.100.00 70 T.,,9 715.e79,50000 27,641.30000 291,79.80000 10120,00000 7.014.30000 2,775.000.00 1.744.50000 67.188.30000 1.083,623.400.00 40.13.00 17 l,,koba 323.959.200 00 31.B14,50000 sk.ss9.000 7,273.70000 3.C36.0000 760.000.00 2.429.20000 17.391,600.00 402,101.70000 39.848,200.00 18 D., es Sala.m 4.3J5,739.700 00 128.01.700 00 1.150.675,300 00 58,591.000 00 75.405.700.00 5,877,000 00 46.611.60000 7,971.000 00 3,662.500 00 434.701.400 00 4.09.112,2000 200.357,700,0 19 lia1n 20 Tenek, 21 O~ndoi 00S0 212.179,00000 212.119.000.00- 19 S1bwanga 453.73.90000 9,197,200.00 04.78.700 00 3.920.000 00 28,77,300 00 3,684.50000 2.141.500 00 71.887,900.00 860,878,300,00 25,801,700 Total Urbtan 73,993,242,2000. 909,731,300. 3,707,223.00.00 217,794.300.00 279.377,90.00 _S.30.20000 67.99,300.00 15,122,000 00 30,13,500.90 , 19447,44,60.00 898r587,600.8 Source Tanltnian Auth0oties Table 19h RECURRENT EXPENDITURE-URBAN COUNCILS 1998799 Educin Hea.br koad. Water Ad.,ist94.non T PE DC PE OC PE OC PE OC PE DC PE OC 1 Amsha 4.4 3.3 95 35 37 7.2 00 00 00 6 4.9 3.5 2 Dodom .4 3 7 60 43 4.5 9.3 212 35.l 0.0 5,7 6.4 4.5 3 rnga 3.1 20 26 48 30 8 2 10.2 00 0.0 3.2 3.0 3.4 4 Kigorna 275 3 1 2.1 24 41 46 00 00 7.9 7.4 2.4 3.0 , Lindi 1 17 20 65 67 52 00 00 00 2.0 1.4 3.0 9 Moshi 3.5 22 4.7 49 6.5 80 00 90 6.7 4.0 39 3.2 7 Mso42 30 300 94 3.9 4.0 .2 9 Mbeyø 59 24 00 10.8 3.9 5.3 3.4 9 Morogoro 5.3 39 34 66 65 89 00 00 75 3.7 4.8 4.8 10 MIS 16 20 22 2.4 36 50 00 00 9, 0. 1,7 22 ii M.arra 59 37 57 14 05 3.5 0.0 00 00 5.3 S.7 3, 12 So7ge8 36 72 76 71 29 18 00 00 s9 3,0 3.2 5.7 13 Sh.y,ang 2.7 4.4 7 35 26 2.9 00 00 00 2. 2.5 4.0 14 srgida 2.5 44 27 52 18 04 0,0 0.0 4.2 2.7 2.4 4.3 is Tabora 5.1 4 34 34 5.: 72 0.0 1 503 42 4.8 11.s o T.n08 51 4.5 79 4 7 2 4.9 0,0 00 5 6 49 5.6 4.S 17 Buko* 23 52 15 3 3 1 3 1 3 00 00 78 1.3 1. 2.1 4.4 1a Dar es05 aam 31.4 21.D 310 27.1 27.0 104 655 52 7 78 315 3.3 22.3 70 19 1 0 0 00 00 00 00 00 0 00 0 .0 9.0 0.0 0.0 2 70,emek 090 00 000 00 0 90 00 00 6.0 0.0 0.0 0.0 27 KaOndnl 0.0 0.0 00 00 00 0 0 00 0 0.0 0.0 0.0 DSSD 00 0.0 9.7 00 00 00 000 0 0 0,0 1. 0.0 19 Sumb...ng. 3.5 30 20 79 103 65 00 00 2.9 02 3. .9 Tot Urban 100.0 700.0 7000 1000 1000 1000 100 1000 100.0 700,0 100 M.Mo Items: ToIRI L.cI Go 77805923000 3332158900 135512000 837504900 1884924200 289671400 1324507300 430764900 182970000 496230000 9962537300 487700700 UrbanfCounc s as 7-8% -8% 27% 26% 15% 19% 5% 4% 1?% 30% 20% 18%¡ Source 74b7e 18. 210 ...Coun.ned T.ie 19b : RECURRENT EXPENDITURC4RVAN COUNCL.S 199W/00 aduc.lon He- od, -ate-rA ä mao. Totl PE OC PE OC PE C PE OC PE PE PE Cc 100 A h 821.66.218.00 60,356,200,W0 360,40,4900 25.000,00000 15<606.391 00 9.179,200 00 - . 149.052,69l.00 0.348.514,255.00 - .35.4. 200 Dod.mo 1.160.400.836.00 76.427 e0000 331.392.f800k 25.358,90000 17,529,3600 5.721,800.00 21,530.34800 17.170.40000 -19. 388,378.00 ,870,471,6,00 125,076,800,00 300 1,0 n 587.938.8 6.00 53,604,800.00 128,451,00000 24,500,000 00 1 t.903,087 00 11,750,000.00 . - 108.297.343.00 836.50.246.09 86.854.800.00 4 00 -K.om 448,614,420 00 72,119,700 00 101.818.057.00 6.201.500.00 14.064.312.00 3,009.60000 32.815.265.00 597,112.054.00 81,30800.00 500 L~di 236,243,501.00 47.303,10000 03,790.374.00 30.434,70000 25.979,59600 $.256,00000 33.865.12200 379,6605i3.08 84,073,500.00 500 Mosh 6047,403.60000 59,017,60000 248.670.31100 20.254.00000 24.442.86900 3652,000,00 171.866.273.00 1,012,383.053.00 42.923, .00 700 Musomfla 590,502.1.00 97,516,900.00 139.729,891.00 45,352,400 00 9,209,702.00 4.517,100 00 86.014.501.00 25,536.705.00 147.36.,40.00 0.00 Mbeya 1.110.981.20300 3206 1.7.055,102 00 l9.614.00 00 06.06.941.00 1.38t.53.188.00 93,.19.00.00 900 Mo-09~oo 1.055,0 071 00 92,598.900 00 189.929.834 00 26.571.400 00 26.489.49100 7.750.000.00 l111.081.351.00 1,390,361,747.00 128920.300.00 1000 MI. 314.031.12.00 36.92,000.00 - 14.475,76500 14.015J00.00 13.313.345.00 3.103.300.00 50,312.6400 492,208..00 5.311,000.80 1100 Mwanza 1,151.986,370.00 66.533,40000 273.329.22200 153700.0000 026.457.00 2.490.2000 193.857.423.00 1.819.79.472.00 84.723,800.00 12 00 5094 0 129.45.60.00 8(.193,185.00 61.991.30000 6,954,84500 2.850,700,w 81.238.42900 860,93.278.00 194,2600.00 1300 shyanga 512,699,460.00 99.419.600.00 8.516.51800 11,28.400 00 I5,449.511,00 3.900.00w00 61.12,1000 6153.777.448.00 114.001,200.0 5400 Smd0 443.725.414.00 84,095.200.00 t 17.859,059.00 46.189.7000 537,284 00 13.143,00.00 96,994.854 00 64.3f.471.0o 123.929,700.00 1500 84554.57 248451,00.00 l55,788.975 00 54.940.000 00 11,345,289 00 13,549.000 00 f0.000.000 00 122.421.349 00 1.13J.11.70.00 32.940.800.00 16,00 Tang0 969.107.19600 g9,34t%00.00 410.022.01500 23,96,60000 10.833.900.00 2.603.10000 171,5990900 l.581,622,83.00 125,941,600.00 :700 B.kobo 434,.04.766.00 112,447,300,00 77,17.155 00 13,401,700 5,040,907.00 1,643.000 00 33,764.479.00 551,227,247.00 127,92000.00 5800 öa, esSaaam 1.247,241.917 00 5,8300.00 00 1.640.363.303 00 10.001.000 00 117,275,01J00 5,000,WO 00 60.009,344.00 - 466,671.06800 8,532.000.705.00 20.831.000.00 19 00 111 129.055.400.00 73.101.700.00 20.00.000 00 - 222.00.00 2000 Tmkr1 70.972,06000 117.423,.0000 20.000,00 00 4.340,000,00 - 02735,800,00 21 00 Kin.ndoni 96,919,200.00 68,114.500.00 20.000,000 00 - 185.033,700.00 000 -- 252.910.862.00 . - - - . 252.910,862.00 2200 Sumbwang. 597.045.713 00 52,610,10000 127.21.78300 17.07.30000 37.545.967.00 ,282,00000 2.24,515 00 99.995,587,00 864.069,60.00 75,68,400.0 7om Distrft. S,882,0,560.00 1,04,030.00 5,094.171,531,00 751,126,600.00 386,997,852.00 173.300,300.00 ,,41, 6.00 350,400.00 2,24-,575.08 2.283,440,412.0 0273062.00 2803,106.0 SouIce Tanzanianf Auflorus .,.Continued Table 96: RECURRENT EXPENDITUMREURAIJ COUNCILS 1999100 ~A feai- R-d. . 1 0 d rUTAL PEr 04C pEi OC PEJ OCI PEI OC PEl OPDC - A~-SbIS 4.3 3.3 3.3 4 0 5.3 0.0 00 005 2 Dodorn .3 4.1 34 . 33 26. 0 5.2. 3 IlingS 3,1 2.9 25 3 3 3 1 6.0 0 0 00 0.0 7 4 Kigoma 24 3.9 20 08 36 17 0,0 00 0 0 1.4 5 LInd, 1 3 2.6 06 41 6. 36 00 00 0.0 5.3 6 Mosh . 34 3.2 4 9 2. 63 21 0.0 00 00 7.5 4. 0 7 MSoma 31 5.3 27 960 2.4 26 00 00 0.0 3.8 3.1 5.3 8 Mbeva 5 9 4.0 3 3 1l8 4.5 3 6 0 0 0.0 0.0 0.8 5.2 3.3 9 Mor2.1g 5. 50 3 7 3 8 68 45 00 00 00 5.2 5.2 4. 10 Mtart I . 2.1 2.28 2.1 55 M~23an 6.1 3.6 54 2! 02 l 4 00 00 00 8. s.9 3.0 12 S-nZ 36 70 I 7 8 3 1 . la 00 0.0 00 3.6 32 et 13 Shrnyanga 27 5,4 1 7 1 5 4.0 2.2 0 0 00 00 2.7 2.5 4.1 54 $ni9d. 23 35 23 6.1 1.5 7.9 00 00 00 42 2.5 44 Tb T.abor 4.5 135 31 73 29 7 00 31.1 0.0 5.4 4.2 1.7 56 Tanga 5. 5,4 0 32 2.8 16 00 00 00 7.5 5.8 4.5 17 s.kob. 23 61 15 18 13 09 0.0 0.1 00 1.5 2.1 4.6 C0 Da,s S0-m 33.1 0.3 322 13 303 29 736 00 00 20A31 ,9 01 19 Ilar. 0.0 70 00 97 00 11.5 0.0 00 0.0 0.9 0.0 7.9 20 Tcmeko 00 38 00 156 00 115 00 138 00 0.0 0.0 7.6 2, Xonondo0 0.0 5 3 0,0 91 0 0 11 5 00 0.0 00 0.0 0.0 t6 DS0 00 00 50 00 00 0.0 0.0 0 0 0.0 0.0 0,9 0.0 22 Sumbarna 3.2 2,8 2 5 23 9.7 3.6 0.0 0.0 100.0 4.4 3.2 2. Total Distich0 1000 100.0 1000 100.0 100.0 100,0 1000 0100 100.0 100.0 100.9 MeO ffemt: TCAIaita Gv.W 107816267827 11108720300 19605298979 2620020800 1583865293 534067100 1913183535 1065097700 2248575 8560413380 139481297509 15333913900 U.rb. Coun-ds as a 18% 17% 26%. 29% 24% 32% 4%1 3% 100% 27% 59% 18% Souce Table 188 211 z %Lý~=0 via :aiamos 1,%9 E 0OO 9'c990t 90001 900 0 0 9000 1 9000001 0090 9 9 S C Zk .(M't9eo 00 6'006 0004 0001 000 000' 00 00 000 0001 0001 0001 s4seUti00 I0 VI 0'0 0001 00 0'0 90 6 VZ Ss z0 ZE 0usqwnS 6 00 0 0 09 06 00 00 00 00 00 00 00 0SSO CS 0'0 O'0 0'0 00 00 Sil 0'0 is 00 00 00 l006PuouDi0Z to 0'0 0'T 00 004 00 011 00 951 00 00 00 a0a100 Li 0'0 0 00 00 00 Sol 00 06 00 0L 00 0\e00L S6Ic >'0 0 0 00 9 L 60 E'z t ' Z0C 0 $ Ce ...0ag .. . 0 9't 10 S1 00 0-0 00 60 ci 20 04 0.0 CE s00gg @'t 90 O 00 00 00 9 00 cC 0t 9I 19 0 '0-0l Zw 0> T$ 00 0 0 DO 6Z z1 00 Sc S e'l00000 It TZ Ib 00 00 00 6'0 l *9 10 Sc I0 piG.S "yI 0 S*0 1Z 00 00 00 11 oo 04 00 ,0 0Z ECUVA-14S U 0 C 69' 00 00 00 91 Ø: CO II 09 1C 190o0el C0 0,9 S' 00 00 00 z4 Z0 0' 9S 09 00 2 0e L ro ZS 0S . 0 00 00 S 9 49 40 ;L 0-S 9 000006 90 ZS g.0 00 00 00 90 59 ,94 IC .00 60 68Aa04'4 t'S 10 t' 00 00 00 90 0Z 09 LE 00 IC *WOfon4i 0C t0 00 00 00 00 L2 00 LZ 69 00 00 !4'on0 6Z 0*0 S4 00 00 00 90 19 09 91 9'0 £l 9 1 0i 0T 0's 00 00 00 14 9. 90 0c c 0 c 2 605n"0DI 0g 6C 0c 00 00 00 99 1 E 0 SC 0Z I C 40di-l'£ 0' 00 00 00 000 99 0 0 1C 9 10 09 zW.z000 S000 C009 S _ 0 C 04 1z sequa gznyutelupzu JI mo 4604104 ad10U4 iadd 1d0d00 40816 90 6E46690 S045200'92 60Z0Z'l0t' S000*080' 6Zit*199'S0 00904'0'0 60000Z9 01'4 0999O lyt'90 00t0t'6900E SS0064/'09'0' 06006'060'G9OC 0004062/9'000 **0'*l910 *e K i00 '00019Z' S0Cc00'6E øv019s?9zc ' E S'9996 5996500ie'9Z" nu.~qwus 0061 0O9'046010 6 9600 1 £1000,WC1 g',"99 06* 00,el luopo04 0001 0*mLIG1MS 166 0l i t 060001'k 90 S510199 56. W'9PC'C 4u 00L L . rEL4 6t'ltt 2.60' totiiCU0 Z",iL ai'0 'EEelt o 0to9vO0 SO099'9S66 00919'000069 00lig 600'£9 PZO,I£Zt 59 909109WC0 06096 999 S099y906'let' og 6'eC5601 90 099e9 sto0tossa14 009u irn'905v5tz st009tt*s Z0L.ZS'0 i 0t9 0i z'0S0'Z6Z' 0690 "66ZZ 00 "0'96>'12 9910*009110 aCi0'990t9 "kq~9 00l se9',c90p SfKO'OL*60091 s969601,00 O0090100' 000090S01 0>9Zti 9 9040 06 ØDUS'00t Z00u000009L 0 0000Z9'0I 0u 0000 LOkt9E*iSKh 050990$0 t¥129'2 cot*s9-¿ LtL0'9* GPr 'l 1 SIW's>ST6 SL £Zt'9*g:'9 ZS0C1e999 S91 0',959 o 00 st 1*o,000s0 Slm'96009 gO'49 099,Z99O94 - z' iol;90 9'6 5t1O'Z5LCW 969 0'Ol 0 106S9> ePhk.!5 090 gi9'LrLit 0e O0es,ffl '0L 5699 '0 Þ9, 0 4 69 'SSS' I 9 4 '11 0' 0 00999 609,9 L OQ0 0 0 S6 690 4 00 ceE t' e S OU A 00 £10 65,8106'øc 0000918068 SS00 ' 0409 IL Z9999 " WZ0000 00 000uZm0'06 90 01z"t00 0S900'00 6G6u09 00 ZL 0f0001000 0-S69100* 5>Ø1o0S'tO0 o£690'ZW9'W0S £0s00 C69,09tz 04 U09592Z ig0000900'000 09905950600 1rue0 0041 50041Gi00 '01 Om u1gis00 00Z900c' 0eZ5 s09160 Zoz u zls'2s0'> S660 000 S0Cs'64000 ÞI0s,'0sz 5 W 04000"0009,8 c 0 W 0040 0042'i'S1 00090'0490'0' 00000'tt'06 •0000260 0444' 0069'0C00 9004t9' 0000001000S1 0000s90'064 S0IL9o'0 0.0604 001 900tie'0L0 £0l195'r60'99 060' t'0 00'620'096'Z 000000900 0Z6090'01 S'S9£'9t91C0 10906Z0,B 0000LS00't0 >'05n 000 »9'0'04'196 99'50Z'Z0001' 0009'500g - t00tS006C'0 S010'S99'SZ 00060'900 0000000000 090tS'o99'00 00000001009 N6100 00 9 060 01 9' 91 ø *101 WOW 1 øZv94m'004 C • 290 006' 09' Z £0,9 0 L 02 0 z o09 g 't tS90 6901 i0t50 90 4 101 0 0 t50005 9 - A0 k0 00 0 9O,ZZt'esrm 5E'9OK,t9","e ørwr51V04L - 9"'ý0f, ormP,>6128 CQ66°C9',5'1SC9' ISSK,91,1 t 00 zn t 5 t>LLO'4 aw u.. 00CL 00001009'g ot6966SI0* 006'065'EL 60 0904199 00S'09000 l0.60'000 00'90 si sf91 014'00 00000496*000 S06000004 0000e690 *0000 000 00'0ii¶i9. ktt9'ws'tI, 00100 6 '_ _ - 0n"000910'9 00019901 90 0690'0940 I96'0C0S'gi0 90VCt 0600et'900 0Iu.0D 36 d 34 30 lad 30 ad 30 30a0d þ|ß uoenmPy alespe gisaguoil_. np WOOL00914*0009 ~ a*96 000 ~ 004onI ....Cont,.d .able 19b RECURRENT EXPENDITURE,URBAN COUNCJLS 2001102 LducaOoon 1elt40ad v4ater dmtoao .( PE 0C PE OG PE Oc PE OC PE PE PE Oc 0 00 Arush0a 942243,52,90 140,942,271.33 374,513.3945 51,773.424 87 06.396,710 55 6.731,023 87 - - - 056.505,331,95 1,412,840,067.7N 199,403,,720 200 dm239.420.877.80 176.472.031.55 347.961.797.40 53340.917.09 1 .406.017.0 4,200.107.30 22.605,165.40 58,018.16662 125.599.296.90 1,753.994.955.3 24,0312225.7 300 IMg 17,335.758 80 125,176.572.65 134.873,550.00 50.737,95843 12,498.24135 8,625.128.60 . - 113,1M2.20.15 87619.41,79.30 114.539.857.82 400 Kigom 471.045.141 00 188,412,095 93 10905.905959.,5 12.542,915 77 14.767,52760 2,209,201 41 - 34,248.02620 25M29.97,86,70 163,464.222,11 500 Und4 248,055,0.05 110.647.616.41 ii,96,192.70 63.025.346 0 27,276.B90.80 4.592.238.68 35,558.378.10 390,479,452.65 17,26,401.25 600 M.s,I0 137.816.405.47 26.103.826.55 41,944.7517.90 25.665,012 45 2.80.763 37 180.459.598. .41.00.2805,8 I12,491.927.74 700 MuSsom 620,027,741.55 227.718,997 6 146.716,385 55 93.921.962 91 9.754.187 10 3.315.793.05 .9.3t5,226.0 966,613,540,25 24,956,753,811 e00 mbey. 1,156,530,263.15 171,928.872.03 fli.407,857.10 25,193.13625 18.319,28910 4,609,655 91 90.373.43805 1.450.30,847,40 2M4.732.4114,2 900 Mo-go 08,10B,454.12455 "1,234,60W.6 10,429.325.70 59,56926 27,813,965 55 5,668.9 4 60 - 23,965,41155 1,4.9,9.834,35 281.093.092.15 10 00 MI.ara 329.739.607.60 89.184.992 21 120.19g.553 25 37.309.379 62 14.052.512.25 2.211.98 22 12,28318.20 518.620.191.3» M28.772,3i1.0 11 00 Mwana 1,20,565.668 50 155.361.112 49 2a6,995,183 10 32.513.710 82 651.79 85 1.821,940.02 189203,50,294.5 ,700.789445.66 18.70,763.34 12 00 Songea 720,172.051.85 302.303,777.28 90,502,544 25 12:.390.07654 7.302,587.25 2,092.566 31 B5,300.350.45 903.977,539.80 432,778A2012 300 Shmyanga 538,334.43500 232.302,712.29 90.842.343.90 22,377,56517 05,221.966.$5 2,562,80864 64.167,799.95 709,506,539.49 296,543,009.10 1400 s,0,da 465,911,747.70 149,613.489.54 2.752.011.95 95.655,958 52 6.017648 20 10.015.279 11 . 101.844.38.70 697.5M4.79.55 255.344.727.17 1500 7a0,» 887,832.07485 590.179,357.94 16.575,423.75 1t3.17.27850 11.915 0345 9,945,190.84 33,759,64195 - 128,542.416.45 .999.8,6..0 737,690,969.23 0900 Tan03 1,017,6255790 231,980,69169 430,523,11690 49.201,259 29 11.375.60340 2.057,525.3- 180,179.694 45 1,39,703,9M6.85 2m0,319,574.3S 1100 00kAb 456,544,9430 262.584.09023 810,498,01275 28,502.451 02 5.202,95235 8.26,04990 - s5,452.702.95 578,789.88935 292,37,591.20 1000 D., es s.laam 6,559.04,07505 13.614,V6S.5 1.722.906,846 15 20.711,440 I 5 123338,753 65 3,670.267 49 63.009.1120 . 490.004.621.40 6,954.663.74.25 37,995,776.19 ,900 d0aa • 301.366,905.19 - 15139.01492 . 14,651,06995 467,436,90.07 7000 Temeke · 165.732,01e93 - 203.11,215l 14.661,06995 14.664.704 91 -43,255.065.00 2100 xm0ndOm - 229.323.203.94 141.060,83794 94,601,0995 - 32,065,17184 Dsso5- 265,556.405.10 - . - - 265.556.405,10 1900 SumbOwanga 626.897.9985 122.853.774.57 933,829,951-15 35.366.01234 39,423,265 35 4,611,324.07 - 2,361,00375 104,995,3M 35 907.04.595,25 092,930.01099 TotalRegi8ons 198286,226,04.00 4,310,814,39.92 3149,980,161.55 1,555.55,9.0 40,347,744.40 1,270,2. 8,616.0 106.472,S13.37 2.361,003.75 39,01620,2.90 2,061,0903,89 989949,81 Source: T4nkanlan Authooiies ...C n.ud1 1b 190; RECURRENT EXPENDITURE-URBAN COUNCILS 2001102 m..nbHeah Road. Wate, Adm,ISITtton MNEA PEI o PE OC PEI Oc PE OC PE PE PE Oc 0 tAO,0 4.3 33 71 33 40 5.3 00 00 9. . 5.0 .3 2Dedom8 6.3 41 65 34 45 33 24 540 90 5.2 6.2 4.9 3½ e 31 2.9 2,5 33 31 69 0,0 0.0 0.0 4.1 3 3 4 K0~me 2.4 3.9 25 0o 36 67 00 0.0 .0 0.4 2.2 3.0 5 UMIl 1.3 2 I1 41 f6 30 0 100 0t . 0.4 2.9 6 Moshl 3.4 3.2 4.9 21 6.3 21 00 0.0 00 7. . 4,1 3,0 lM,soma 3.1 53 2.7 0 2.4 26 0.0 00 00 3. 3.9 .3 8my. 59 40 33 18 4 5 36 0.0 00 0.0 3. 52 3.4 9 0 regaro056 500 37 3 6 45 00 0,0 0.0 5.2 5.2 4.6 10 Mf.#r. I 2.1 23 24 5 18 0.0 90 0.0 2.2 1.8 2.1 11 m .0ar 6 0 36 54 21 02 14 0.0 00 00 8.5 6.1 3.1 12 Gonge. 39 7.0 1 75 1. 16 0.0 0,0 00 3.6 3,2 7.1 13 S"7eg~ 2.7 54 0 75 4.0 2 2 00 0,0 0.0 2,7 2,5 4,2 14500gi4 23 3,5 2 3 61 1 5 79 0.0 00 0.0 4.2 2.5 4,2 ,5 Ta.o- 45 13,5 31 13 29 70 0.0 31,7 0.0 5.4 4,2 12,1 6 T.ngi 50 54 90 32 29 16 00 9.0 00 7.5 5,9 4.6 17Bukobe 2.3 90 15 18 13 09 0.0 00 00 ,5 2,1 4.8 18 D.r Ow S.I... 33.1 93 322 1,3 303 29 736 00 10 20.4 31,9 0. 19 l.0. 0.0 70 00 97 00 11.5 QO 00 0 0.0 90. 7.7 20 Temke 00 39 0.0 156 00 10, 03. 00 00 0.9 7.2 21 XmOndon. 00 .3 00 1 00 11.5 00 09 00 00 0,0 9.3 0550 .0 0.9 5 o 0 000 00 90 00 0g 0,9 00 00 $oomblwange9 3 2 29 2 5 2.3 907 3.6 0 9 0 00 0 .4 32 3 total Regions 100.0 1090 1000 0000 00 0 9 100.0 100,0 100,0 Mem eme:'gjo-l" To~f1-.oca4GoW4. 113207102218 23358443430 2055555302 1995412250 0663095859 669933770 268842712 20203256 236004 996434049 149405232466 392501820 Urb.n Con0drc 404 18. % 26%j 13% 24% 19 4% 4% 10, 27% 19% 18% So.rce: Tabl. 18a 213 ...Continued. T. lb: RECURRENT EXPENDITURE-URBAN COUNCILS 2000103 L dcanon Heatth moAd, Water Adm raftf.ation 10Al PEI OC_ Pr 11E PC PE C PE oC PE oC Pe 00 1 Arusha 662.934,529 90 183.245,e85 37.513.3964 ~ 67313.41 95 16.386. 1055 75466 .73 156,505.31185 1,41,83 ,.75 2,1 2 Lorn. l,239,420,977 88 232.040,14B,1 347,961.79.40 69.351.114 53 19.406,117.8 4,704,120. 1 22.606.865 0 75.432,233 6 . 125.59,299 1753.994,55.30 31,527,616.48 3 ,Iring 617.335,75660 162,748.136 23 134.873,550 00 659667901 12.48.24135 9,660,144.03 -ed 113,712,210.15 878.419755.30 2387S150.27 K%orn. 47I.045,141.00 21896,741.5 106.909.959 5 16.91.7979 141.77.527 60 2,474,312.30 - 34.246.028 25 82.~67.658.70 239,132751.65 5 hdI 248,055,991.05 143,858,59501 67.966.192 70 81.946.211.13 27.278.890.0 5,143,307.32 - 35.558.37.10 398.879.452.865 30.849,163 48 6 Mos0. 619.773,71000 179,181,791.24 26.103.8265 54.534.41500 25.665,012.45 3.002.454.98 - 180.459.56.65 147,.002205.65 23678,97.22 7 M-s~om 620.027.741.55 296.089,511 60 146.715.385 55 122.112.501 31 9,754,187.10 3,713.668 22 90.315.226.05 86,813.540.25 42.894,708.20 vMbes9 9.l6.530.283.15 223.53,0893 175,407,057 10 36,656.044 53 18,319.28 10 5,163.0534868 90,373.43605 1,450,630.447.48 285,352.152.14 9 MooOlo 1.108,654,124.55 281.137,106.97 199.426,325 70 76,929,225 04 27.813,9655 6,37.58436 - 723.65,418.55 9.45,879,34.35 384,437,91.7 I 100 r329.739,807,60 115.953,735 64 120,199.553 25 48,507.734 79 14,052.512 25 2,551.34691 - 52.628,318.20 51620,191.3 167,012.817.43 11 M-anr. 1.209.5s.668.50 202.000.321.74 266.995.66310 42,272.65308 657,779.65 2.047.292.82 . 203.550.294.15 1,70789,445.6 248,320,267.65 12 5.0e'm 720.872.057.85 393.039.809.35 90.502.844 25 166 913.156 82 7,302.58725 2.343.674 26 - 85.300.350 45 903.977.839.8 52,298,650.43 13 Sh,yaNga 538,334,433.00 302,028,026 13 90,842.343.90 30.394.306 2 16.221,986 55 3.205,345 66 - - 64,167,756 95 709,56,536.40 33S.A28.60.83 14 sing-la 465.911,747,70 94.597.766.27 123.752,01195 124.306.953 12 6.070.64820 11217,11269 . . 101.844,356.70 697,564,794.55 338,189,63.,0 15 TAo-s 867,632.97465 754,316.034.81 163.578.423.75 147,977.360.53 11,915,70345 lI139.173 74 43,931.55306 . 12B,542,41646 1,9988,61.50 457,316,122.14 16 7'ng. 1,017.62,557 90 301,60,353.54 430.523.118 90 64.072.956 45 11.375.603 40 2.304.54045 - . 180.179,694 45 1,639.703.974.65 37,8,850.30 17 Bukob. 456,544,94130 341,398.316.92 81,498,01275 37.161,431 59 5.292,95235 1,350,77599 - . 35.452.702.95 578.780~.35 379.910.524.40 in D1 es Sabam 6,559,604,075 95 17,700,3110 6 1,722,96.466 15 21.921,949 27 123.138.763.65 4,10,699 59 63,009,811 20 . . 490.004,621 40 8,958,563,740.25 48,73,115.91 1 9 . a31,21,736.49 196,28.204 06 - 16.442.796 35 -N5,09738.90 20 T~mekl 21,7641,23962 - 3t6,166.59624 - 16.442.795 35 19.066,294 03 567,151,928,14 21 Koondoni 294,253,857 21 . 183.400.D40 2 - 16,442.798 35 - - 494.06,895.58 DSSD • 265,556,405 o 265,556.405.10 19 S-mb-weng. 626,897,998655 159.728.153.48 133,26.951 15 45.981.08 69 39.423.2653 5,16.6296 • - 2,361,003 75 104.995,36 35 907,304.585.5 3 219,873,905.14 To1aRegion, 19.4826.226,588.00 5.604,499,663 86 .348,80,107.5 2.6022,427,65493 406.347,744.40 142,543,27666 99,610,676.60 130,430,080.94 2,361,003.76 2,397,429,832.69 28,847.652,953,66 79966.39 Souce T.a-Man AYorges ...C.ntm,,ed Table 19b RECURERNT EXPENVITURE.UtBAN COUNCILS 2000/03 LdUcafon Ha W.ftr Adm11t rae ToT Pe DC PE oC PE DC PE OC PE Pi PE oc 43 3.3 71 33 40 53 0.0 00 00 6.4 . 3,3 63 41 65 34 45 33 264 545 60 .2 .6.2 4.9 ra3.1 29 2.5 33 3 . 0.0 00 00 47 31 3.0 2.4 39 20 09 36 17 0.0 00 00 1.4 22 3.0 5Und 1.3 26 16 41 67 36 0 0 00 1,5 1.4 2.9 6 Msh 34 32 49 2.7 63 2.1 00 0.6 06 7.5 4,1 3,0 7 Mm a 53 27 60 24 26 00 00 00 3.8 31 5.3 Mbev. 5.9 40 33 18 45 36 00 00 00 3,8 5.2 3.4 9 Moo90 5 6 50 3 7 3 60 4 5 0.0 0.0 0,0 5.2 $.2 4,6 1 9 1.7 2 1 2 2 24 3 5 1. 0 0 D. 0 0 2.2 1.8 2,1 61 36 54 2 1 02 .4 0.0 00 00 85 6.8 3,1 2Snes3 6 760 1 7 8 3 tl o6 0 96 0 0 0 3,6 3.2 7.1 13 Shinyanga 2 7 5.4 7.7 1,5 4 0 2 2 0.0 0 0 2.0 2.72 2.5 4.2 l4 Singers 2 3 3.5 2 3 67 1I1 7.9 0 0 060 0.6 4.2 2.5 4,2¯ 1 6 mTa b -r 4 5 9 3 5 3 . 7 .3' 2 7 6 0 6 3 1 7 0 0 5 4 4 .2 1 2 ,1 18 8 TgI15 8 0 32 28 1 6 60 00o .0 75 6.8 4.7 17 ukob8 2 3 1 IS 5 1 713 0 9 0 0 060 0 0 1.5 2,1 4.8 9 -1,8Or 1e8aa 331 03 372 13 363 29 736 6.0 0.0 20.4 31,9 9,6 19 saPm7 9 7 7 0 1 16 0 0 0.0 0,6 .0 7.7 20 Tem0eke 9.0 3.8 0 0 156 0 0 115 090 13.9 0.0 08 8.9, 7,2 21 Kinhundong 0.0 5.3 00 91 00 1I5 0.0 0.0 0,0 0.0 0.0 ,.2 00sD 0.0 60 50 00 00 0 00 00 00 0.0 0.9 0.0 19 sngna 3. 2.9 2 3 23 .7 3.6 00 80 0.0 4, 3.2 2.7 TotalIRegions 100,6 700.0 100.0 100 0 100 0 10060 100.0 10060 100 0910.0 100,6 100.0 Memnlo lems: ToUlI .60o Gov 13207002218 30620470490 2058556369 I179426378 16630596556 760325923 2000042712 3943315697 2361604 9980434048 146455382486 5311904334 Urban1Counilsi ,5 18% 16% 28% 11% 24% 15% 4% 4%, 100% 27% 19% 15%g Souce: Table 19a 214 Table 204: Devtlopment Empendliture-inistriøs 99/99 199W2000 2000/01 2001,02 2002103 Loca Foreign Local Foeign 1.ocal Foreign t.ocal Foreign Local Foreign 26 Admlstration ice Fresrdents 00ic. 27 Admnistr0-n Regvsrr of Poacal Parts 30 Adm-iind ,bon Predn Offie ad C,binelt cretarina 3,000,000.000 00 31 AdMston VIce Pres,derNs Office 2,422,079.000.00 2,045,896,003.37 32 Admm.istraton Preident' Ofic. - Civ,l Service Department - 302,986,000 00 500,000,000.00 298,162,30050 - - 33 AdMinistr: on EZhicsSecretlaral 34 Adm,Ietrbon M~ntkyofarenAa,r, ,nCo-p] r C-fion 35 Admmisro6b0n Permaent Commis.cn Of Enury 30 Admm,nistraf CM1 Servce Ccenmdssio 37 AdminisOraon Prime MNi.r,c' Ol.ce - 5277,640,000 00 200,00,000 00 4,457,940,144.22 209,668,025 63 - 413,621,87Q0 - 416,145,732 86 40 AdmmisraonM ,Judii.ry 41 Admnistrfti.on Ministy of Juste and Con-bluioral Afars 248,924,000 00 210.262,5695 37 42 Adminstrsion Oflice f61Speak 45 Adminstro.n Exdequer and Audit Variment 50 Admnistraton Miniltry .f Flarics VOTE 50 39,887,452,00 00 1.322.000,000 00 33,692,368,676 38 - - 51 Administraion Mini%y of Hoe. Affa.rs 54 Adm,~islrn RadTranzania 1,600,0000,00000 55 AdmlnMstr",on Tanznia Investment Centre 56 Adminitraon Mini,by of Røgonal Adm &Local Got 100,000,000.00 193,750,000 00 290,625.000 00 387,00,000 00 319,184,461.72 57 AdministrMoon Ministry of Deftne and faoln ece - 1,0u00000,000 00 - 59 Admin'str4oi Law R,form Commission 60 Admirnstr6.on Ind.srial Courf T.aaa 61 Admr*Atfo Elecial Cora mslio 63 Administra~on Local Govemenrt Sermice Commis.nM 06 Adrrini,traion Presldet Office - Planing Commislon - 969,875,00000 500,000,000.00 819,239,746.63 Sub-Total 100,000,000.00 49,168,948,000.00 8,16,700,000.00 41,623.877,466.48 600,23,026,63 - 01,121,71170 - 106,010,114.68 38 Deence nd Seamty DefcI e 39 fee and SecurIt Th Nabonal Ser2,1 2' Defece and Seunty Polce Force 29 Defenc. and S'ciy Ministry of Ham Affakr - Pnsons Sub-Totl - - 0 0 . 46 Socal servicos Misn,try.'Educti.o 1,100,000.000,00 9,758,977,00000 2,131,250 000 60 8.243,270,364.53 2.234,274.89808 4,407,658,155,59 4,434,552,6.83 - 52 Soial services Mnistry of"eaft 2,000,000,W0.00 19,487,64,000 DO 3,375,000,000.00 16,460,90,533 44 3,,38,147,932,44 - 6,979,869,220.00 - 7.022,459.242.08 53 Socal Oseces Mmiity of C~mmnmty Dev, Gender & Culture 2,36B,000,000.00 2,000,216.234 0 65 Soal sees Ministry of Latour and Yoth velopment 1,700,000,000 00 1,435,906,046,41 - 67 Sodial seMces Teahers Service Commis/lon 08 Socialsrvces M,ni.sr of Scen, Tech & Higher Educa0lion 900,000,000.00 3,790,458,000 00 1,743,750,0000 3,201,745,463 73 1,828,043,098.43 - 3.606,265,763 67 - 3,628,270,608.41 49 Soc.a.i ees MStyofWaer 2,000,000,000 00 28.710,18.600 00 3,225,000,00r 00 24,251,091,267 11 3,212,738,251.22 6,329.673,296.50 - 6,38,295,92.24 Sub.Toal 6,000,006,000.00 66,816,317,000.00 10,476,000,000.00 06,693,270,60.23 10,g13,204,100.17 21,323,46,434.76 - 24,463,78,748.87 - 47 EconomiY srvices Meistyof Works - 51,14,812.000 00 4.00,000,000 00 43,204,000,791,92 - - . 48 Ecmoo ices MnIstry of Lands & Human Setilerents Dev 500,000,000 00 - 524,170,064.07 1,034.054,6G9 26 1,040,364,332.10 56 E,co,nic srces Mnistrby of Ergy d Mineral 900,000,000 00 22 928,659,000 00 1,743,70%,000.00 19,307,515,184 55 1,828,043,098 43 3,06,285,783.67 3,628,270.908.41 62 Econic servces MinistryofCmmurnctionsandTransort - 9,200.000,000 00 - 7,771,110,368.81 - Sub-Tot 900,00,000.00 83,277,471,000.00 6,243,760,000.00 70,344.306,$46.29 2,362,213,162.49 4,660,20,462.93 4,668,434,940,67 9 Produchve M~nstry of Naioral Resources and Tourism - 7,65.1,737,~0000 - 6,460,003,0009 - -. 43 Prodctve Mnetry of AgncIture and Co.operativs 1,000,000,000 00 20,850,10,000 00 2,437,500,000.00 17,611,853,259.74 2,555.329,062 32 5,041.016,658 89 5,071,776,111.28 44 Procbe Mnistry of Industries and Trade • 320.000.000.00 - 270.299,491M0 . . Sub.Tota 1,000,000,000.00 25,523,917,900.00 2,437,600,000.00 24,347,106,60.92 2,66,329,062.32 - 6,041,016,066.9 6,071,776,119.28 Total-Ministries 3,000,000,000,00 227,076,001.000,00 27,472,000,000.00 191,107,611,271, 16,221,03,430.60 - 31,8605.525,437.28 32.000,000,000.00 S.u-rce Th. Tar,4ian A.thrnbes 215 T-blh lo: DevelhpetE Etpe.drMntrie (kn p. V) 19'8/99 19920 2000o01 2042 2002/03 Leet T-~tn Les Tvtn L%-% !F~ts Lterk T~rig L"a.I eai 26 Adm..ti-on Vi- Pr.~dend OTe 30 Administraria Pr-r«ddt~O5ioa.dtCbéntSecrtada · 10.9 - 31 Ad- ~r.0tato V.opresidet8omOf - 0.1 - Li 3 Ad,.~imsados 3re'0aaOfice-Ciod 0.io.Dep.doen - 0 1. 01 - 33 Ad.u=no Eha S...srt 34 Adm_strai.. MiiyofF*oigz.Af.& .Co-opra - 35 Adm-s~,ain C.mmissiotEoquiy - - - - 36 Adm~~0l Ciils~viC-sio.- 37 Adit~tn EsimMinistfs01c - 23 0.7 2.3 3 1.3 13 40 Adm- ~on Y"dici~ry 41 Ad.in.-0in Mi.nyofu adConst .n.InAff..r - 0.1 - 0.1 42 Ad-un~~an Off-Ib-Sp.r 45 Ad.i~.trabn Exc~hmgradAuditD~lih0n - - 30 Ad&ån~tatio- Mintyofi nc VOTE30 - 176 4.0 17.6 - - 51 Adm,inihtraiso MinstryoofHo.mAfais - -- 54 Adti.i"ti.on Rad.oTan-ai• - 5.8 35 Adi44ot-n T.z.ni. ~-re6stin 2anti, - - 56 Ad-o.. MinitryofRt.n,WAdft&Lc«WGovt 13 0.7 1.. 2 12 57 Admemnation Mii6tyofDf.swnNa..1elic - - 36 39 Aanron. Lawlm-fonn Com.sion. 60 A dnir1ion Inustrl Court6. 0of OT aazania 61 Adminisra10o Electbr1Commission - 63 A,d,Iut~tlon Lo.a Govrmnt S-ice Comusson - 66 Adminiut-on Presid.ent' sOf -PlingCemaasion 04 1.3 d4 - S,b--T"ta 13 2L6 303 216 31 25 2.5 38 Df.ncad S-curity Defne - 39 D dflaceandsecunty s~ Th.Nauo&.Srv 28 Def..cadS.unty PoliF.orc- • 29 D.f1 »ds5.uy Mini.ty ofHoeAff.-r - Pct-s S»b-T-tJ 46 5Socaevces 0isty.ofEdcao 133 1 3 r 4.3 133 13.9 13.9 52 Soc.iasv,ce --tryorHewlth 25.0 0.6 123 06 218 21.9 219 53 S.oia .vi itfyofComnityDv. Gndr&C.ku- • LQ 1 0 65 Socolservicr MinistryofLourYoutDevlopnent - 7 0.7 - 67 SOdservice Teacer'bevc.Comiso- • - - - 6. So,lserices Min~ryofSeienc.Te&c HiEdumaion 13 1.7 63 17 l13 113 113 49 Soc,-Iasrices MinistryofWat r 25.0 126 11.7 126 198 199 199 Sb-To 750 290 391 290 66 7 67.0 670 47 E c-k-i e0ke 2. Mitry ofJWorks • 223.5 L4 6 225 48 EMoomicservice M4ntyfLand& Humans~-d-rn.entDe - - 1 2 33 33 50 EcoonsOO icer Mi,yofEmegyano4din.rai 11.3 100 63 10.1 113 003 11.3 62 Eoornicsevce* Minityo fC.o.o.o.- andTranport - 41 - 41 - - Sub-Tetal 113 36.7 22.7 367 14.5 146 146 69 prod0ctve Moiry of N4"ra RWor- d Touni-m • 3.4 - 34 - 43 Prod0cve M:it.,ofA6iculW..ad C-p-flti-e1 12.5 92 89 92 10 138 150 44 Prodctivm -nd yofladustrierandTsad. 0.1 - 0.1 - sub-T.tal 12.5 12.7 89 12.7 138 15.8 158 T0thI-Minitre 100.0 1000 1000 1000 100.0 1000 1100.01 Sour Tabl 2"a 216 Table 21a: Development Expenditure-Regions 1998/99 199912000 2000101 2001/02 _____ 2002/03 _____ Local Foregin Local Foreign Local 2 Foreign Local Foregin Local Foreign 70 Arusha 105,000,000.00 2,000.000,000.00 319,720,000,00 l.689.371,819.31 360,000,000.00 - 400.000,000.00 - 400,000,000.00 71 Pwani 105,000,000.00 439.617,000.00 319.720,000,00 371,338,285,54 360,000.000.00 400.000.000.00 - 400,000,000.00 72 Dodoma 105,000,000.00 2,104,239,000.00 319,720,000,00 1,777,421,033,84 360,0000000.00 - 400.000,000.00 - 400,000,000.00 73 Irnga 105,000,000.00 1.217,000,000.00 319,720,000,00 1.027,902,752.05 360.000,000.00 - 400.000.000.00 - 400.000,000.00 74 Kigoma 105,000,000.00 179.458.000.00 319,720,000,00 151,585,643,97 360,000,000.00 - 400,000,000.00 - 400.00,00000 75 Kilimanjaro 105.000,000.00 - 31U,720,O00,00 360.000.000.00 - 400.000,000.00 - 4000,0000000 76 L.ndi 105.000.000.00 267.000,000.00 319,720.000,00 225,531,13788 360,000,000.00 400.000,00000 - 400,0000000.00 77 Mare 105,000,000.00 2,585,127,000.00 319,720.000,00 2,183,620,351.57 360,000,000.00 - 400.000,000.00 - 400,000.D.00 78 Mbeya 105,000,000.00 140.000,000.00 319,720,000.00 118,256,027,35 360,000,000.00 - 400,000.000.00 - 400.000,000.00 79 Morogoro 105.000,000.00 938,655.000,00 319.720,000.00 792,868,652.53 360,000,000.00 - 400.000,000.00 - 4000000.00- 80 Mtwara 105.000,000,00 650.00.000,.00 319,720,000,00 549,045,841 27 360.000,000.00 - 400,000,oS.O 4W.O0,000.00 81 Mwanza 105.000,000.00 793.654,000.00 319,720,000,00 670,389.350.94 360,000.000.00 - 400.000,000.00 - 400,000,000.00 82 Puvuma 105,000,000.00 230,823,000.00 319.720,000,00 194.972.935.72 360,00000.00 - 400,000,000.00 . 400.000.000.00 83 Shinyanga 105.000,000.00 600.000.000.00 319,720,000.00 506,611,545 79 30,000,000.00 - 400,000,000.00 - 400,000,000.00 84 Singida 105.000,000.00 300,000.000 00 319,720.000.00 253,405,772,90 360.000,000.00 - 400,000.000.00 400,000,000.00 85 Tabora 105.000,000.00 - 319,720.000.00 360.000.000.00 - 400.000000 - 400.000.000.00 86 Tanga 105,000.000.00 600..000,000.00 319.720,000,00 506.811,545,79 360.000,000.00 - 400.000.000.00 - 400.000,000.00 67 Kagera 105.000.000.00 6.266.503,000.00 319.720,000.00 5,293,226,786.00 360,000,000.00 400.000,000.00 - 400.000.000.00 88 Dar es Salaam 105,000.000.00 7,897.805.000.00 319,720,000.00 6.671,164,600,69 360,000,000.00 - 400,000.000.00 4W.00.000.00 89 Rukwa 105.000,000.00 179.458,000.00 319.720.000.00 151.585.043.97 360,000,000.00 - 400.000.000.00 - 400.000 .00 iTotal Regions 1 2,100,000,000.00 27,389,339,000.00 6,394,400,000.00 23,135,388,728.03 7,200,000,000.00 . 8,00,000,00,00 - 3,000,000,000,.00- Source: The Tariznian Aulhorities Table 21b: Development Expenditure-Regions (in percentage) 1998199 199912000 2000/01 2001/02 2002/03 Local Foreign Local Foreign Local Foreign Local Foreign Local Foreign 70 Arusha 5.0 73 5.0 7.3 5.0 50 5.0 71 Pwani 5.0 1.6 5.0 1.6 5.0 50 5.0 72 Dodoma 5.0 7.7 5 0 7.7 5.0 5.0 5.0 73 Irlnga 5.0 4.4 5.0 4.4 5.0 5.0 5.0 74 Kigoma 5,0 0.7 5.0 0.7 5.0 5.0 5.0 75 Kilmanjaro 5.0 0.0 50 0.0 5,0 - 5.0 5.0 76 Lindi 5.0 1.0 5.0 1.0 5.0 - 5.0 50 77 Mara 5.0 9.4 5.0 9.4 50 5.0 5.0 76 Mbeya 5.0 0.5 5.0 0.5 5,0 5.0 5.0 79 Morogoro 5.0 3.4 50 3.4 5.0 5.0 5.0 80 Mtwral 5.0 2,4 50 2.4 5,0 . 5.0 5.0 81 Mwanza 5.0 2.9 50 2.9 5,0 +5,0 A5.0 82 RUvuma 5.0 0.8 50 0.8 5.0 5,0 50 83 Shinyanga 5.0 2.2 50 2.2 5.0 5.0 .A5.0 84 Singida 5.0 1.1 50 1.1 5.0 5,0 5.0- 85 Tabora 5.0 0.0 50 0.0 5,0 5.0 5.0- 86 Tanga 5.0 2.2 5.0 2.2 5,0 5.0 5,0 - 87 Kagera 5.0 22.9 5.0 22.9 50 5.0 5,0 88 bar es Salaam 5.0 28.8 5.0 28.0 5.0 5.0 5.0 89 Rukwa 5.0 0.7 50 0.7 5.0 - 5,0 5.0 Total Ragions 100.0 100.0 100.0 100,0 100.0 - 100.0 100.0 Source Table 21a 217 Table 22a: Foreign Assistance Cash Flow (in Mill. US S.) Donor Type Budget Projection Projection Projection 1998/99 1999100 2000/01 2001/02 ADBIADF Project 23.1 17.33 12.99 9.75 SOP Support 40.0 30.00 22.50 16.88 BADEA Project 3.9 2.89 2.17 1.62 EU Project 21.6 18.33 12.83 8.98 SOP Support 37.9 26.11 5.00 5.00 IDA Project 115.5 86.63 64.97 48.73 SOP Support 40.0 33.00 24.75 21.26 KUWAIT FUND Project 1.5 1.16 0.87 0.65 OPEC FUND Project 1.5 1.16 0.87 0.65 UNDP Project 7.7 7.70 7.70 7.70 Total Multilateral 292.7 224.3 154.6 121.2 Project 174.8 135.2 102.4 78.1 BOP Support 117.9 89.1 52.3 43.1 BELGIUM Project 4.5 4.47 4.47 4.47 CANADA Project 3.9 3.85 3.85 3 85 DENMARK Project 33.4 33.42 33.42 33.42 MDF 3.3 3.30 3.30 3.3 FINLAND Project 4.2 4.24 4.24 4.24 MDF 5.0 5.00 4.5 3.5 GERMANY Project 6.0 6.01 6.01 6.01 IRELAND Project 4.6 4.62 4.62 4.62 MDF 2.0 2.00 2.00 1.0 JAPAN Project 15.4 15.40 15.40 15.40 cis 8.0 8.00 6.00 6.00 NETHERLANDS Project 13.1 13.09 13.09 13.09 MDF 9.5 9.50 7.13 4.6 NORWAY Project 26.7 26.72 26.72 26.72 MDF 2.7 2.7 2.7 2.7 SWEDEN Project 36.5 36.50 36.50 36.50 MOF 8.3 6.0 4.0 2.0 SWITZERLAND Project 3.9 3.85 3.85 3.85 BOP 6.7 6.00 4.50 3.27 UK Project 7.7 7.70 7.70 7.70 BOP 8.0 6.00 4.50 3.90 MDF 20.0 17.00 16.50 8.0 USA Total Bilateral 233.4 225.4 215.0 198.2 Project 159.9 159.9 159.9 159.9 cis 8.0 8.0 6.0 6.0 SOP 14.7 12.0 9.0 7.2 MOF 50.8 45.5 40.1 25.1 Grand Total 526.0 449.6 369.6 319.4 Project 334.6 295.0 262.2 237.9 CIS 8.0 8.0 6.0 6.0 BOP 132.6 101.1 61.3 50.3 Assumptions: Programme assistance incuding MDF is assumed to decline by 15 percent from 1998199 base. Foreign loans are projected to decline by 15 percent from 1998/99 base. Project grants are projected to increase by 15 percent each year. Exchange rate: 1999/2000 is Tshs. 705 per $, 2000/01 is Tshs. 715 per S and year 2001/02 is 720 per $. Source: The Tanzanian Authorities 218 Table 22b: Foreign Assistance Cash Flow (in percent) Donor Type Budget 1998/99 Projection Projection Projection 1999/00 2000/01 2001/02 ADB/ADF Project 4.4 3.9 3.5 3.1 BOP Support 7.6 6.7 6.1 5.3 BADEA Project 0.7 0.6 0.6 0.5 EU Project 4.1 4.1 3.5 2.8 BOP Support 7.2 5.8 1.4 1.6 IDA Project 22.0 19.3 17.6 15.3 BOP Support 7.6 7.3 6.7 6.7 KUWAIT FUND Project 0.3 0.3 0.2 0.2 OPEC FUND Project 0.3 0.3 0.2 0.2 UNDP Project 1.5 1.7 2.1 2.4 Total Multilateral 55.6 49.9 41.8 38.0 Project 33.2 30.1 27.7 24.4 BOP Support 22.4 19.8 14.1 13.5 BELGIUM Project 0.8 1.0 1.2 1.4 CANADA Project 0.7 0.9 1.0 1.2 DENMARK Project 6.4 7.4 9.0 10.5 MDF 0.6 0.7 0.9 1.0 FINLAND Project 0.8 0.9 1.1 1.3 MDF 1.0 1.1 1.2 1.1 GERMANY Project 1.1 1.3 1.6 1.9 IRELAND Project 0.9 1.0 1.2 1.4 MDF 0.4 0.4 0.5 0.3 JAPAN Project 2.9 3A4 4.2 4.8 cis 1.5 1.8 1.6 1.9 NETHERLANDS Project 2.5 2.9 3.5 4.1 MDF 1.8 2.1 1.9 1.4 NORWAY Project 5.1 5.9 7.2 8.4 MDF 0.5 0.6 0.7 0.8 SWEDEN Project 6.9 8.1 9.9 11.4 MDF 1.6 1.3 1.1 0.6 SWITZERLAND Project 0.7 0.9 1.0 1.2 BOP 1.3 1.3 1.2 1.0 UK Project 1.5 1.7 2.1 2.4 BOP 1.5 1.3 1.2 1.2 MDF 3.8 3.8 4.5 2.5 USA 0.0 0.0 0.0 0.0 Total Bilateral 44.4 50.1 58.2 62.0 Project 30.4 35.6 43.2 50.1 CIS 1.5 1.8 1.6 1.9 BOP 2.8 2.7 2.4 2.2 MDF 9.7 10.1 10.9 7.9 Grand Total 100.0 100.0 100.0 100.0 Project 63.6 65.6 70.9 74.5 CIS 1.5 1.8 1.6 1.9 BOP 25.2 22.5 16.61 15.8 Assumptions: Programme assistance including MDF is assumed to decline by 15 percent from 1998/99 base. Foreign loans are projected to decline by 15 percent from 1998/99 base. Project grants are projected to increase by 15 percent each year. Exchange rate: 1999/2000 is Tshs. 705 per $, 2000/01 is Tshs. 715 per $ and year 2001/02 is 720 per $. Source: Table 22 219 Table 23a: Summary Of Audit Certificates Issued Accounts and Statements awarded Accounts and Statements awarded Accounts and statements issued an Clean Certificate Qualified Certificate Adverse Opinion FY94 FY95 FY96 FY97 FY94 FY95 FY96 FY97 FY94 FY95 FY96 FY97 Total Ministries 46 40 69 48 40 8 24 10 4 i 61 53 55 82 43 Total Ministries (percent) 39.3 33.6 51.1 35.8 42.6 4.8 20.2 7.4 3.0 11.7 52.1 44.5 40,7 61.2 45.7 Total Regions 28 24 31 20 0 4 4 8 10 0 43 52 41 46 60 Total Regions (percent) 37.3 30.0 38.8 26.3 0 5.3 5.0 10.0 13.2 0 57.0 65.0 51.3 60.5 100 Local Authorities (LAs) 6 9 8 20 23 7 8 9 30 20 13 22 23 37 65 Total LAs (percent) 23.1 23.1 20.0 23.0 21.5 26.9 20.5 22.5 34.5 18.6 50.0 56.4 57.5 42.5 59.8 Table 24: Unvouched and Improperly-Vouched Expenditures YEAR UNVOUCHED IMPROPERLY-VOUCHED TOTAL UNVOUCHED & TOTAL EXP. IMPROPERLY-VOUCHED Absolute Values Percent of Total Absolute Values Percent of Total Absolute Values Percent of Total Exp. Exp. Exp. FY94 5,225,000,000 1.87 10,250,000,000 3.67 15,475,000,000 5.54 279,139,409,583 FY95 2,788,700,000 0.54 5,609,200,000 1.08 8,397,900,000 1.61 520,752,632,680 FY96 1,344,000,000 0.45 13,903,000,000 4.62 15,247,000,000 5.07 300,791,759,110 FY97 6,005,000,000 1.60 25,676,000,000 6.84 31,681,000,000 8.44 375,291,200,370 FY98 5,464,849,265 1.06 40,363,465,604 7.80 45,828,314,869 8.85 517682490317 TABLE 25: Cash and Stores Losses (in TSh) YEAR TOTAL EXPENDITURE TOTAL LOSS OF CASH AND STORES TOTAL LOSS AS PERCENT OF TOTAL EXPENDITURE FY94 279,139,409,583 787,477,521 0.28 FY95 520,752,632,680 301,508,742 0.06 FY96 300,791,759,110 72,960,000 0.02 FY97 375,291,200,370 971,000,000 0.26 FY98 517,682,490,317 751,151,042 0.15 220 Table 26: Summary of Excess and Saving (FY94-FY98) Excess MINISTRIES/DEPT Recurrent Development AND REGIONS FY94 FY95 FY96 FY97 FY98 FY94 FY95 FY96 FY97 FY98 TOTAL MINISTRIES 7,252,813,726 231,660,281 13,753,752,829 3,939,311,177 1,996,893 1,482,172,148 495,717,400 91,627,968 TOTAL REGIONS 2,073,135,528 1,053,361,504 197.277,935 16,697,877 3,634,386 674,583,542 GRAND TOTAL 9,325,949,254 1,285,021,785 13,753,752.829 197,277,935 3,956,009,054 5,631,279 1,482,172,148 495,717,400 91,629,768 674,583,542 Saving Recurrent Development FY94 FY95 FY96 FY97 FY98 FY94 FY95 FY96 FY97 FY98 TOTAL MINISTRIES 744,473,926 7,974,082,682 33,615,424,377 56,929,568,019 42,293,204,841 49,482,765,434 83,480,905,337 98,358,808,804 70,140,688,278 188,792,388,216 TOTAL REGIONS 47,735,447 1,745,081,589 8,713,193,045 1,453,556,604 665,075,203 2,901,945,108 7,140,424,291 17,983,182,827 8,787,275,582 17,012,093,826 GRAND TOTAL 792,209,373 9,719,164,271 42,328,618,422 58,383,129,623 44,958,280,044 52,384,510,542 90,621,229,628 116,341,991,631 78,927,963,860 205,804,482,042 Table 27: Summary of Queries Issued and Percentages Replied and Not Replied FY94 FY95 FY96 FY97 FY98 MINISTRIES/DEP NO. OF NOT REPLIED NO. OF NOT REPLIED NO. OF NOT REPLIED NO. OF NOT REPLIED NO. OF NOT REPLIED AND REGIONS QUERIES REPLIED (percent) QUERIES REPLIED (percent) QUERIES REPLIED (percent) QUERIES REPLIED (percent) QUERIES REPLIED (percent) (percent) (percent) (percent) (percent) (percent) TOTAL 3266 91.2 8.8 2338 86.0 14.0 1790 92.2 7.8 1640 90.1 9.9 1824.0 80.9 19.1 MINISTRIES TOTALREGIONS 2954 84.5 15.5 2424 84.2 15.8 1590 92.5 7.5 1434 90.2 9.8 1265.0 96.8 3.2 GRANDTOTAL. 6220 88.0 12.0 4762 85.1 14.9 3330 92.3 7.7 3074 90.1 9.9 30890 874 12.6 Table 28: ESSENTIAL ITEMS FOR PRIORITY SECTORS- FY00 VOTE SUBVOTE ITEM DESCRIPTION P.E. O.C. TOTAL 1. BASIC EDUCATION: 70-89 101** all O.C.Subvention to Local Authorities 79,607,472,000 11,106,720,300 90,714,192,300 70-89 204 2012 Examination expenses in the RAS budget 92,314,600 555,947,400 648,262,000 46 301 all MoEC - Basic Educ.Subvote O.C. 58,368,700 10,282,800 68,651,500 46 501 all MoEC - Teacher Educ.Subvote O.C. 1,890,973,200 860,975,500 2,751,948,700 46 202 all MoEC - 75% of Inspectorate Subvote O.C. 541,730,800 241,118,200 782,849,000 46 201 30630 Subvention to Institute of Adult Education 413,812,700 2,966,100 416,778,700 46 101 30625 Subvention to Nat. Examination Council 241,509,500 529,000,000 770,509,500 67 all all 75% of TSC O.C. 51,521,500 114,016,700 165,538,200 Total Basic Education 82,897,703,000 13,421,026,900 96,318,729,900 2. PRIMARY HEALTH: 70-89 101** all O.C.Subvention to Local Authorities 14,503,602,400 2,628,028,800 17,131,631,200 52 201 1709 _ Local Authorities drugs allocation (kits) 221 budgeted under Moll - 6,600,000,000 6,600,000,000 52 301 all MoH Preventive Subvote O.C. 311,613,500 3,637.011,100 3,948,624,600 70-89 302 all [Regions Preventive Subvote O.C. 197,546,400 903,278,900 1,100,825,300 Total Primary Health 15,012,762,300 13,768,318,800 28,781,081,100 3. WATER 70-89 101** all O.C.Subvention to Local Authorities 1,408,379,800 1,065,097,700 2,473,477,500 49 401 all MoWater O.C. 1,802,120,900 1,001,704,400 2,803,825,300 70-89 204 1803/181 Regions O.C. items 18,462,900 56,680,300 75,143,200 8 Total Water 3,228,963,600 2,123,482,400 5,352,446,000 4. RURAL ROADS 70-89 101 all O.C.SubventiontoLoca Authorities 88013,900 360,686,300 1,240,900,200 56 202 2301 Road Fund budgeted for Districts - 13,988,700,000 13,988,700,000 47 701 all MoW -Rural Roads Subvote O.C. 356,351,000 7,329,900 363,680,900 Total Rural Roads 1,236,564,900 14,356,716,200 15,593,281,100 5. JUDICIARY 40 jall jall All O.C. under Judiciary Department 4,034,703,600 3,912,649,600 [7,947,353,200 6. AGRICULTURE RESEARCH AND EXTENSION 43 301 all MoA - Research Development Subvote 654,157,500 774,550,000 1.428,707,500 O.C. 43 201 all MoA - Crops Development Subvote O.C. 3,350,707,800 1,961,588,900 5,312,296,700 43 401 all MoA - Cooperative Development Subvote 402,098,000 1,330,043,100 1,732,141,100 O.C. 43 601 all MoA - Livestock Devt. Subvote O.C. 2,506,087,700 686,866,600 3,192,954,300 Total Agriculture Research and Extension 6,913,051,000 4,753,048,600 11,666,099,600 7. HIV/AIDS- I -_I - - Total Priority Sectors 113,323,748,400 52,335,242,500 165,658,990,900 * MoF to look into mechanism that will ensure easy verification of allocation for HIV/AIDS in the year FY01 budget. ** Breakdown for subvention to Local Authorities is found in Appendices to Volume III of Estimate Book. 222