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Tanzania: Air Tanzania Among Entities that Borrowed Money Without Approval, says Parliamentary Accounts Committee

Dodoma. Air Tanzania Company Limited (ATCL, is among institutions that have been named by the Parliamentary Accounts Committee (PAC) that borrowed Sh896 billion without the approval of the Ministry of Finance and Planning as required by the law.

Another institution named by the PAC team is the Arusha International Conference Center (AICC).
The Vice Chairman of the committee, Mr Japhet Hasunga said this on Thursday, October 21, 2021 during an interview with The Citizen after reviewing the report of the Controller and Auditor General (CAG) for the year 2019/20.

Mr Hasunga said they have also noted the lack of a proper record keeping for the national debt where some debts are either not visible or the records are not accurate.

“All institutions that borrowed money without the ministry’s approval are required to repay the debts because we have identified they were not approved by the Finance and planning ministry,” Mr Hasunga said.
He did not however say when exactly the said monies were borrowed.

In addition, Hasunga said the committee found that the criteria used to assess the sustainability of the debt was not well established.
“The government said criteria would change as Tanzania is currently classified as a middle income country,” he said.

It was the same report that identified that Air Tanzania Ltd among the loss making government entities.
During his report presentation at the State House Dodoma, CAG Charles Kichere said one of the loss-making companies that came to the forefront was ATCL, emerging that the carrier has incurred losses worth Sh150 billion in the past 5 years.

CAG Kichere said ATCL flights traveling abroad run the risk of being impounded because of the huge debts and the related interests.

“During the pandemic, many aircraft were parked but ATCL was paying rental fees regardless of whether the aircrafts were not operating due to the Covid 19 challenge. This was due to the lease agreement between Tanzania Government Flights Agency and ATCL. ‘There was no clause in the agreement that says when the aircraft is not functioning we should not pay,”CAG Kichere was quoted.

He said between March and June 2020, ATCL was charged Sh15.4 billion for aircraft rental while they were not providing services and the agency also inherited huge debts with interest.

SOURCE: The Citizen