Servicing of Tanzania’s National Debt to Gobble Up Sh9.5 Trillion in 2017/18

The government plans to spend Sh9.46 trillion on servicing the national debt, including paying contributions to social security funds in the next financial year, Finance and Planning minister Philip Mpango said as he tabled his ministry’s budget yesterday.

In the current financial year, the government set aside Sh8 trillion for the same purpose and up to the end of March, Sh6.5 trillion or 82 per cent of the approved budget had been released.

Dr Mpango tabled his budget asking the Parliament to approve Sh11.75 trillion for the ministry and its institutions.

He also said the national debt was sustainable even as MPs warned the government over the growing debt, especially due to its interest.

The National Audit Office will get Sh61.8 billion for recurrent expenditure with Sh44.5 billion being for operational charges.

The office will also get Sh11.8 billion for development expenditure compared to Sh12.2 billion set for the current budget.

In the current financial year, the government approved only Sh32.3 billion for recurrent expenditure of the audit office with just Sh18.5 billion set for operational costs.

The reduced budget raised fears that the Controller and Auditor General (CAG) would not be in a better position to audit development projects.

However, this time the government has almost doubled the recurrent expenditure for the CAG.

MPs speak out

Some MPs said the government should take precautionary measures over managing the national debt despite the government’s stance that it was sustainable.

Mr Peter Serukamba (Kigoma North-CCM) said the government should consider borrowing under a fixed interest arrangement to avoid the swelling of the national debt. “Our national debt is not sustainable if you measure it in terms of revenue collection. The government must also consider paying the domestic debt to help pension funds operate smoothly. I know the government has a good intention of consolidating the pension funds, but it must make sure it pays debts before joining them together,” he said.

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Source: The Citizen

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