Committee links poor management in LGAs to fraud,abuse of public funds

30May 2020
Henry Mwangonde
Dodoma
The Guardian
Committee links poor management in LGAs to fraud,abuse of public funds

​​​​​​​THE parliamentary standing committee on Local Government Authorities (LGAs) has linked fraud and abuse of public funds in councils with a number of factors including poor management of accounting system, delays and bureaucracies in paying contractors.

LAAC chairperson Vedasto Ngombale.

The Local Authority Accounts Committee (LAAC) made the revelation yesterday when tabling its report in the National Assembly. It also accused local councils of violating the public procurement regulations and none compliance to the use of POS machines.

The committee chairperson Vedasto Ngombale faulted the councils over poor harmonisation of the EPICOR accounting system.

“Some councils have been withholding NHIF contributions and other statutory charges,” said Ngombale adding some of the councils have not been claiming value-added tax (VAT) on projects implemented by development partners.

In its report to the parliament over the annual audit reports of the controller and auditor general for the financial year ending June 2019, LAAC tasked the government to control misuse of public funds in local authorities.

Ngombale said: “Despite the beginning of the use of electronic devices in revenue collection, there are some local government authorities such as Lushoto, Mbulu, Tarime and Siha that are still using hand written receipts to collect revenue”.

After tabling the report, a section of MPs demanded explanations from the government over several issues raised including consistency of massive flaws in local government spending due to fraud, financial error and legal claims.

In his report, the Controller and Auditor General (CAG) Charles Kichere revealed massive misuse of public resources done through overpayments, payments without contracts, payments without actual delivery of services or goods and generally disregarding public procurement guidelines in government and its institutions.

 Ngombale cited the CAG report for the 2018/19 financial year whereas he said a total of 26 councils received 22.8bn/- in excess from the initially allocated budget.

 

The amount, according to the committee was a 33 per cent equivalent to the total budget planned for development budget in local councils.

The chairperson noted that some councils face shortage of workforce making it easy to mismanage public funds. He called upon the government to release the development grants on time as specified in the budget allocations.

During the same financial year, at least 157 councils did not receive 556.8bn/- grant for development.

Records shows that in 2015/16 at least 620bn/- or 61 percent of the grants wasn’t released to councils. In the last financial year, some 258.6bn/- was not released affecting the councils’ efforts to implement development programmes.

Despite financial errors, the local authorities’ accounts committee acknowledged that there have been some improvements in public fund spending among councils across the country.

The committee says the development could be reflected with enhanced social service—not limited—to education, health, security, defence, transportation and logistics.

The overall level of corruption and corruption compliance have also increased, said Ngombale.

A 2019 report by Transparency International indicated that corruption rates in local government authorities dropped to 10 percent in 2019 from 25 percent in 2015. Equally the rate in which people provide corruption to access service at local councils has dropped to 18 percent from 25 percent during the year under review.

Muleba South MP, Prof Anne Tibaijuka (CCM) and Mary Chatanda (Korogwe-Urban, CCM) lauded the government for disbursing development funds in local councils that have helped improve service delivery in the communities.

The MPs also called on the government to allocate the required budget to be able to address the audit query.