Donors insist on more escrow action

Dar es Salaam. Donors have said they were still waiting for solid government response on Tegeta escrow account investigations, their spokesperson said on Tuesday.

“DPs (development partners) trust that Tanzania’s accountability systems will handle the case thoroughly and are looking forward to a solid response to the findings from the government,” said the DPs chairperson, Finnish ambassador Sinikka Antila.

In May, this year, 12 donor countries and multilateral bodies, including the World Bank, withdrew $558 million (nearly Sh1 trillion) budget support for 2014/2015 over the Tegeta escrow scandal.

And the US government recently announced that it had put on hold the signing of the Millennium Challenge Corporation (MCC) compact with Tanzania pending the government’s action on the Tegeta escrow scandal. The value in the MCC facility was pegged at around $700 million in five years from 2015.

The Finnish envoy made the statement shortly after President Jakaya Kikwete had sacked minister for Lands, Housing and Human Settlements Development Prof Anna Tibaijuka over the Tegeta escrow account scandal. The President announced the decision on Monday when delivering his verdict on the scandal in a televised address to the nation via a gathering attended by Dar es Salaam elders.

President Kikwete also said he had formed a special team to probe minister for Energy and Minerals Sospeter Muhongo over his role in the controversial matter.

He directed other public service disciplinary provisions be pursued in response to calls to drop the Energy Permanent Secretary Mr Eliakim Maswi, whose quick suspension to pave way for investigations followed on Tuesday night in a statement from the office of the Chief Secretary Mr Ombeni Sefue.

During the address, Mr Kikwete’s take on the scandal largely left many questions unanswered in relation to the parliamentary recommendations that suggested stern steps against all those it viewed as culpable in the scandal involving the fraudulent withdrawal of Sh306 billion from the central bank. The money was equally controversially shared among top public figures, including those in government and businessmen.

Many of the recommendations by Parliament were apparently left hanging and the President’s speech, despite the dropping of Prof Tibaijuka and the suspension of Mr Maswi, has since attracted widespread criticism across the nation.

The President’s critics say his action fell short of implementing the Parliament resolutions in their entirety and that he had sought to defend the same escrow scandal culprits.

The Parliament had recommended that two ministers, energy and minerals permanent secretary Mr Eliakim Maswi, Attorney General Judge Francis Werema should be sacked while the Tanesco board of directors should be dissolved over the IPTL scandal. Mr Werema has since resigned as AG.

On Tuesday, Ms Antila said the DPs welcomed the President’s statement acknowledging the resolutions approved by Parliament and confirming some action and further investigations.“While still assessing the situation, DPs maintain dialogue with the ministry of Finance and any decisions on further disbursements will be communicated to the minister,” she said, on inquiry if the donors would consider releasing the withheld funds in the wake of the response by the President.

Ms Antila said the DPs were encouraged by the submission of the Controller and Auditor General (CAG) and Prevention and Combating of Corruption Bureau reports to the Parliament and its Public Accounts Committee (PAC), the tabling of the PAC report to the Bunge, the ensuing debate, and the resolutions passed by the Parliament.

She clarified that to date, only $84 million or approximately 15 per cent of the committed budget support funds for 2014/15 have been disbursed. This amount was disbursed before the Tegeta escrow account scandal.

The Tegeta escrow scandal involved the fraudulent withdrawal of Sh306 billion from the central bank to pay Independent Power Tanzania Limited (IPTL).

The money, part of which a parliamentary investigation found to be public, was then shared among public figures and influential individuals.