A NEW directive abolishing retention of funds in public institutions will not cover
local government authorities and social security funds, the government said on Wednesday in the National Assembly.
The Minister of State in the President’s Office (Regional Administration and Local Government), Mr George Simbachawene, clarified that the directive which was contained in a speech by Finance and Planning Minister, Dr Philip Mpango had been retracted through an erratum.
“Public institutions to be covered are parastatals which are fully owned by the government and it will not affect local councils and pension funds,” he explained.
The original speech by the finance minister on the guidelines for 2016/17 development plan and budget contained a part that abolished retention by all public institutions, including local governments.
A number of MPs debating development proposals took issue with the move by the government to shelve retention of funds in local government authorities, arguing that the decision will cripple councils.
Babati Urban MP, Ms Pauline Gekul (Chadema), and Kigoma North MP, Mr Peter Serukamba (CCM), opposed the move by the government to abolish retention of funds, arguing that the decision will cause bureaucracy and cripple performance of public institutions.
Ms Gekul argued that the shelving of retention will lower morale in revenue collections at local councils, stressing on the other hand that decentralization was introduced to bring services closer to the people.
Source: The Daily News