Members of Parliament in Tanzania have called for urgent reforms in Local Government Authorities (LGAs) following audit findings that exposed weak oversight of council investments, stalled development projects, and weaknesses in public fund management. The Parliamentary Standing Committee on Local Authorities Accounts (LAAC) presented a report in the National Assembly highlighting these issues. The committee, led by Chairperson Ado Shaibu, identified operational challenges affecting strategic investments such as markets, bus terminals, and commercial buildings. These challenges undermine the performance, service delivery, and revenue generation of these investments.
The committee's report pointed out that poor planning and inadequate supervision are major contributors to the underperformance of council investments. To address this, the committee called for stronger government oversight of council investments and improvements to bus terminal infrastructure. Councils were also directed to address defects identified by the Controller and Auditor General (CAG) to ensure that facilities operate effectively and generate expected revenue. Furthermore, the committee urged the company managing Rock City Mall in Mwanza to comply with relevant laws so that Mwanza City Council and Ilemela Municipal Council can receive their dividends.
The committee's report also highlighted issues related to development financing. Councils were directed to account for or restore 36.92 billion Tanzanian shillings that should have been allocated from their own-source revenue for development projects in the 2024/25 financial year by June 30, 2029. The government was also directed to provide funds to complete stalled projects, including Ngangamfumuni Bus Terminal in Kilimanjaro Region, an operating theatre at Tunduma Town Hospital, Mwanza City Council's Health Department offices, and Sikonge District Council headquarters.
To improve revenue collection, councils were instructed to recover 8.52 billion Tanzanian shillings in outstanding service levies by December 30, 2027. The National Food Reserve Agency (NFRA) was also directed to pay 2.916 billion Tanzanian shillings owed to seven councils and other authorities with similar claims by the same date. Additionally, the Ministry of Lands, Housing and Human Settlements Development was directed to remit 13.54 billion Tanzanian shillings owed to councils as their 20% share of land rent by June 30, 2028.
The committee noted that some councils lack strategies to strengthen own-source revenue collection and remain heavily dependent on central government grants. Councils were also directed to update taxpayer databases by January 30, 2027, and submit the information to the CAG by March 30, 2027. Furthermore, councils were instructed to remit 13.88 billion Tanzanian shillings in statutory allocations to the Women, Youth and Persons with Disabilities Fund by June 30, 2028.
The government was also urged to recover 120.48 billion Tanzanian shillings in loans issued to groups by the same deadline, with future loans following the 4:4:2 allocation ratio. Other recommendations include filling vacant leadership positions in council departments and units, strengthening internal audit functions through adequate staffing and resources, and remitting 3.90 billion Tanzanian shillings in unpaid employees' contributions to the Public Service Social Security Fund (PSSSF) by December 30, 2027.
The committee's report also called for public procurement in the 2026/27 financial year to be conducted through the electronic NeST system and urged the Public Procurement Regulatory Authority (PPRA) to audit areas where the CAG identified weaknesses. Dodoma City Council was given until December 30, 2027, to address contractual irregularities in the leasing of Dodoma City Hotel. The Ministry of Finance was also directed to settle debts owed to public servants and suppliers that were questioned by the CAG.
Key points
- The Tanzanian government has been urged to provide funds to complete stalled projects and recover outstanding service levies.
- Councils have been directed to update taxpayer databases and remit statutory allocations to the Women, Youth and Persons with Disabilities Fund.
- The government has been called upon to review the rates at which councils allocate own-source revenue to development projects before the 2027/28 financial year.
