Dar es Salaam. Twaweza Executive Director Aidan Eyakuze has criticised Tanzania’s budget for the 2023/2024 financial year, saying it focuses more on economic growth than lifting people out of poverty.
The leader of the regional non-governmental organisation criticised the budget during an analysis he presented at a forum organised by The Chanzo to discuss the state of public accountability in the country, the 2023/2024 budget, and the ten per cent local government loans.
Known as The Chanzo Specials, the forum attracted over 300 participants from universities, the private sector, the public sector, and civil society. Supported by GIZ, a German international development cooperation agency, the forum took place at the PSSSF Commercial Complex in Dar es Salaam.
In his keynote address during a session to analyse the government’s proposed budget for the 2023/2024 financial year, Mr Eyakuze opined that the budget does not answer current critical challenges facing Tanzania.
He mentioned the challenges as widespread poverty among Tanzanians, widening inequality, and deteriorating quality of Tanzanians, to name but a few of the challenges.
Mr Eyakuze criticised the budget for allocating very few funds for sectors that play a critical role in improving the welfare of Tanzanians, including education (13 per cent), health (5.4 per cent), and water (three per cent). On the other hand, administration gets 41 per cent and economic production 21 per cent.
“The question is this, why do we prepare the budget for?” Mr Eyakuze asked rhetorically. “Is this a strategic or a tactical budget? There is a big difference between the two. What is our national strategy? Is it just to grow our economy, even at the expense of mass poverty of almost half of the population?”
On June 16, 2023, Finance and Planning Minister Mwigulu Nchemba tabled the government’s Sh44.39 budget for the 2023/2024 financial year, which is a seven per cent rise compared to the Sh41.5 trillion in the ending 2022/2023 financial year.
Tanzania Revenue Authority (TRA) is expected to collect Sh26.73 trillion in revenues, while non-tax revenue is expected to be Sh4.66 trillion. About Sh5.44 trillion would be borrowed from domestic non-concessional sources, and Sh2.1 trillion would be borrowed from external non-concessional sources.
The government’s key priorities for the coming financial year appear to be developing its mega projects that remain unfinished, which include the construction of Standard Gauge Railway (SGR), Julius Nyerere Hydropower Project, and revamping the national airline ATCL, to name but a few.
But Mr Eyakuze suggested in his keynote speech on Monday that the strategy should be to promote the welfare of Tanzanians.
“It is important that we implement a budget that will make Tanzanians feel that their daily lives, and the lives of their surrounding communities, are getting better and better,” he said.
“It seems this budget aims to grow the economy,” Mr Eyakuze continued. “Okay, grow the economy, and then what? Economic growth does not necessarily mean the improvement of people’s welfare.”
Many during the discussion that followed Mr Eyakuze’s address questioned the process of preparing the budget, with some pointing out that fewer citizens’ participation in the process led to their priorities being ignored in the final budget proposal.
Along with issues of capacity on the part of ordinary people to engage in the budget-preparation process, a senior tax manager with the PwC Tanzania, Redempta Maira, mentioned the time allocated for the exercise as a contributing factor to the challenge.
“We’ve hardly two weeks two discuss the budget proposal put forward [by Mwigulu] until the Finance Bill is passed in the parliament,” Ms Maira, whose organisation consults clients on tax compliance issues, explained.
“It’d have helped if the Finance Bill was passed at least a month ago to enable people to discuss the proposals put forward and to allow the government to make necessary changes and improvements,” she added.
Richard Kayombo, the Director of Taxpayer Services and Education with the Tanzania Revenue Authority (TRA), said that the government does not target economic growth just to please itself but because it believes it will ultimately improve people’s living standards.
“Take the construction of roads as an example,” Mr Kayombo said. “One would consider that as not a priority but for people of that given area, such an infrastructural development directly impacts their individual welfare.”
“This particular road will help a farmer get her crops to the market,” Mr Kayombo added. “It will ease the movement of people and goods from one place to another, which boosts trade and other social interactions which are essentials in the community.”