WASHINGTON, March 21, 2024—The World Bank has approved new funding to help Tanzania strengthen its revenue management, modernize public procurement processes, and improve resource allocation and audit effectiveness.
The new $50 million Public Finance Management and Procurement Systems for Service Delivery
Program will strengthen the capacity of the Mainland and Zanzibar to mobilize and manage public resources at the national level through strengthening institutional capacity, efficiency, and transparency, and accountability. Ultimately this will result in an improvement in service delivery for the citizens of Tanzania.
The operation is designed as a program for results (PforR) which links disbursements directly to the achievement of specific program results (‘result areas’) or outcomes. The program is structured around four key results areas.
The first result area will support the government's revenue mobilization agenda including enhancing the e-filing system and launching taxpayer awareness campaigns. The second result area will focus on increasing the efficiency and transparency of the public procurement management, including specific activities to enhance the electronic government procurement system capacity development and implementation of sustainable procurement practices. The third result area will support efforts to improve financial management through better budgeting processes (including a citizens’ budget in Swahili) and financial reporting. The fourth result area will enhance accountability by supporting activities that strengthen external audit and parliamentary oversight.
"It is commendable that the government acknowledges the vital role of robust public financial management and procurement systems in driving Tanzania’s development agenda, and that is why they initiated this program,” said Nathan Belete, World Bank Country Director. “While there has been important progress in this area over the past few years, it is important to continue to assess and address persisting weaknesses in order to enhance the timely delivery of public services and development operations for the benefit of citizens.
Recent PFM reforms have led to significant achievements in the sector. The rollout of electronic revenue collection systems is among the most notable, contributing to a 350 percent increase in non-tax revenue collection over the past five years. Other important reforms include the adoption of a treasury single account, the rollout of expenditure management systems, the introduction of electronic procurement systems, the development and rollout of the central budget management information system, and the strengthening of parliamentary oversight functions. Despite these gains, there are continuing weaknesses in core aspects of PFM such as the lack of a reliable, credible annual budget, a weak control framework, inefficiencies in revenue collection and taxpayer compliance, and shortcomings in the financial reporting of public institutions.
“Additionally, delays in procurement create significant hindrances in the timely delivery of public services and the implementation of development operations in Tanzania,” said Paul Welton, World Bank Senior Financial Management Specialist, and co-Task Team Leader. “Considering that 70 percent of the country’s annual budget, or $13 billion, is spent through public procurement, any improvement in the public procurement system will result in great economic benefits to the country. Ultimately, all citizens and businesses in Tanzania will benefit from improvements in transparency, accountability, and service delivery.”
