A review of road sector reforms in Tanzania

Sub-Saharan Africa Transport Policy Program Saharan Africa Transport licy Program The World Bank and Economic Commission for Africa SSATP Discussion Paper No. 2 Paper No. A Review of Road Sector Reforms in Tanzania Ajay Kumar April 2002 Apr Africa Region The World Bank  A Review of Road Sector Reforms in Tanzania Ajay Kumar1 Sub-Saharan Africa Transport Policy Program (SSATP) Saharan Africa Region The World Bank 1 This paper is based on work carried out under the Road Management Initiative (RMI) and I would like to thank Stephen Brushett for providing me with this opportunity. I would also like to thank Yitzhak Kamhi, the transport team leader for Tanzania for providing me with the necessary data, support and guidance in preparing this paper and David Rudge for introducing me to the basic concepts in road engineering. Special thanks go to Monique Desthuis-Francis for editing this paper. A major source of information has been the many people in donor agencies, road agencies, and transport associations in Tanzania, who have generously shared their experience. I would particularly like to thank: Ms. R. Mang'enya, Road Fund Board Chairperson; Mr. Joseph Haule, RF Manager; Mr. M.A.Nathani, RF Board member; Mr. Olav Ellevset, TanRoads Chief Executive; Mr. Willey Lyatuu, RMI Country Coordinator; Arne Olsen, First Secretary, Royal Norwegian Embassy. The paper draws from a number of studies conducted by the Road Fund Board and other agencies, including: the Study to Review Road User Charges and Rates for Sustainable Road Financing, Public Expenditure Review of Trunk and Regional Roads (COWI, 2001), Final Report on Criteria for Allocating Road Funds to Districts and Design of an Appropriate Disbursement and Monitoring System (January, 2001), Road Fund Board Annual Report (2000/2001).  The opinions and conclusions expressed here are those of the authors and do not necessarily reflect the views of the Sub-Saharan Africa Transport Policy Program, the World Bank, UNECA, or any of their affiliated organizations.  TABLE OF CONTENTS ABBREVIATIONS AND ACRONYMS....................................................................................IV PREFACE .....................................................................................................................................V SYNOPSIS..................................................................................................................................VII I. THE STUDY CONTEXT......................................................................................................1 II. THE STUDY OBJECTIVE ..............................................................................................2 III. INSTITUTIONAL AND MANAGEMENT STRUCTURE...........................................3 ROAD FUND BOARD.....................................................................................................................3 ROAD EXECUTING AGENCIES......................................................................................................4 IV. PROCESS...........................................................................................................................8 ADEQUACY OF ROAD FINANCING................................................................................................8 THE DISBURSEMENT PROCESS...................................................................................................11 REVENUE COLLECTION AND RELEASE PROCESS.......................................................................12 PERFORMANCE MONITORING ....................................................................................................12 V. OBJECTIVE ACHIEVEMENTS ..................................................................................15 QUALITY OF THE ROAD NETWORK............................................................................................15 OPERATIONAL EFFICIENCY........................................................................................................17 RESOURCE ALLOCATION ...........................................................................................................23 VI. CONCLUSIONS..............................................................................................................24 iii  ABBREVIATIONS AND ACRONYMS RONYMS CEO Council Engineer's Office CTLA Central Transport Licensing Authority DANIDA Danish International Development Agency DC District Council DE District Engineer DMT District Management Team FY Fiscal year (July 1 to June 30) GDP Gross Domestic Product IRP Integrated Road Project IRP Integrated Road Project MC Municipal Council MoF Ministry of Finance MoW Ministry of Works MRALG Ministry of Regional Administration and Local Government NBC National Bank of Commerce Limited NMB Ltd National Microfinance Bank Limited NRB National Roads Board PORALG President's Office Regional Administration and Local Government PS Permanent Secretary RAS Regional Administrative Secretary RF Road Fund RFB Road Fund Board RMI Road Management Initiative RSDP Road Sector Development Program SADC Southern Africa Development Community SSA Sub-Saharan Africa SSATP Sub-Saharan Africa Transport Policy Program TanRoads Tanzania Roads Agency TRA Tanzania Revenue Authority TSh Tanzanian shilling TSh 967.00 = US$ 1.00 [as of April 2002] iv  PREFACE Tanzania has been one of the countries at the forefront of reforms inspired by the Road Management Initiative (from the outset). This paper focuses on some of the main challenges that the country now faces in consolidating an institutional structure -- setting up both the road fund and a new main road agency -- to carry the reform process forward and secure sustainable improvements in road sector performance. The paper is based on extensive fieldwork and stakeholder interviews carried out in 2001 as well as on a review of the major lessons emerging from past reform experience in Tanzania. This case study -- the second in a series issued by the RMI -- will contribute to the preparation of an intensive program of support to Tanzania from RMI which has been agreed as part of the RMI Interim Work Plan for 2002. The SSATP is keen to ensure that greater efforts are devoted to the generation of new knowledge and its effective dissemination to countries, partner organizations and donors. Discussion Papers will provide an additional channel alongside Working Papers, Technical Notes, the website, videos and CD-ROMs. They will focus on exposing and analyzing case studies of promising or innovative practices